The council area was created in 1996, under the Local Government etc (Scotland) Act 1994, with the boundaries of the former Clackmannan district of the Central region. The district had been created in 1975, under the Local Government (Scotland) Act 1973, to include the county of Clackmannan and Muckhart area of the county of Perth.
According to the legislation of 1996, the council area was to have the name, Clackmannan, of the former district, but this was changed to Clackmannanshire, by the council using its own powers.
In terms of population, it is the smallest council area in mainland Scotland, with a population of 49,000, around half of whom live in the main town, Alloa, which is the administrative centre, having outgrown the town of Clackmannan in 1822.
The motto of Clackmannanshire was "Look Aboot Ye" (Circumspice in Latin), however this was dropped in 2007 as part of a re-branding exercise to "More Than You Imagine".
| Party | Councillors | |
| Labour | 8 | |
| Scottish National Party | 7 | |
| Conservative | 1 | |
| Liberal Democrat | 1 | |
| Independent | 1 |
Alloa railway station reopened in May 2008. A new railway line connecting Kincardine and Stirling, reconnecting Alloa to the national rail network for the first time since 1968 was opened to the public. Passenger services only operate towards Stirling, the line to Kincardine is for freight trains only. An opening ceremony was held on Thursday 15th May, with the first fully functioning passenger service commencing in the new summer timetable on 19th May 2008. The service provides an hourly connection between Alloa, Stirling and Glasgow Queen Street.