The name Zgornja Lipnica literally means 'upper Lipnica', distinguishing the village from neighboring Spodnja Lipnica, which stands at an elevation lower. The name Lipnica, like related names, is derived from the Slovene common nounlipa 'linden', referring to the local vegetation.
Zgornja Lipnica is the site of two known mass graves from the period immediately after the Second World War. The Lancovo 1 and 2 mass graves lie north of the settlement and contain the bodies of a large number of civilians and Croatian soldiers murdered on the night of May 15, 1945. The first grave lies from the road and is wide and long. The second grave lies on a wooded slope near the first.