Blue Canyon is an unincorporated community in Placer County, California. Blue Canyon is located 4 miles southwest of Emigrant Gap. It lies at an elevation of 4695 feet. Blue Canyon was possibly named for the blue smoke of the camps when extensive lumbering occurred there in the 1850s. It might otherwise have been named after a miner from that s…Blue Canyon is an unincorporated community in Placer County, California. Blue Canyon is located 4 miles southwest of Emigrant Gap. It lies at an elevation of 4695 feet. Blue Canyon was possibly named for the blue smoke of the camps when extensive lumbering occurred there in the 1850s. It might otherwise have been named after a miner from that same period named "Old Jim Blue".