There is no dispute over this one, it's just your garden variety error. It stems from a bad map and a negotiated treaty between England and the United States.
The error created several unique geographic situations including,
the fact that it is the only section of the Continental U.S. Border that extends above the 49th parallel, the latitude that marks the majority of the US border with Canada. Even Maine, which optically appears further North on some projections remains south of the 49th Parallel.
it creates a situation where driving from one spot in the Minnesota to another spot in Minnesota requires a 63 mile drive into Canada and then back into the U.S. even though the two spots are just 18 miles apart as the crow flies.
It is one of only four places in the continental U.S. where a section of a state (other than an island) is disconnected from the rest of the state.
According to the Wikepedia entry,"The Treaty of Paris, concluded between the United States and Great Britain at the end of the American Revolutionary War, stated that the boundary between U.S. territory and the British possessions to the north would run "...through the Lake of the Woods to the northwestern most point thereof, and from thence on a due west course to the river Mississippi..."
That all sounds pretty simple and clear as far as border descriptions go. The only problem was that the line could extend West all the way to the Pacific Ocean and never run into the Mississippi River. The source of the Mississippi, Lake Itaska lies almost 150 miles south of where it was expected to be. The error started with the Mitchell Map, a map that was in widespread use at the time.
When the problem was corrected by the Anglo-American Convention of 1818 it created a chunk of land that is part of Minnesota but cut off from the rest of the state. That land is called, The Northwest Angle, or simply, "The Angle" by locals. It is sparsely populated and most of the land is under the stewardship of a local Indian tribe. The immigration and customs office for The Angle is actually a phone booth with a video phone in it.