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Clayton was laid out in 1857 by Joel Henry Clayton and his two younger brothers at the foot of Mount Diablo in Contra Costa County.

Local history says Clayton's name was settled by a coin flip between Joel Clayton and co-founder Charles Rhine, who wanted the town named after himself; Joel Clayton had originally wanted to call it Garibaldi.

The Clayton post office opened in 1861, and the town prospered during the eastern Contra Costa coal-mining boom centered on the nearby Black Diamond mines.

Clayton incorporated on March 18, 1964, after voters had rejected incorporation in 1960, in order to block Concord's 1963 attempt to annex the Cardinet Glen neighborhood.

Clayton more than doubled its land area in 1987 through annexations that included the Dana Hills and Dana Ridge areas, Clayton Wood and the Keller Ranch, which later became the Oakhurst Country Club.

Clayton had a population of 11,070 in the 2020 Census, up slightly from 10,897 in the 2010 Census.

Clayton has around 3,982 households averaging 2.74 persons each, about 89.2% of its homes are owner-occupied, and the median owner-occupied home value is $1,055,200.

Clayton's public schools are in the Mount Diablo Unified School District and include Mt. Diablo Elementary, Highlands Elementary, Diablo View Middle School, Pine Hollow Middle School and Clayton Valley Charter High School.