The castle has stood on the rocky peninsula at Dunbeath since 1428 when the lands belonged to the Earl of Caithness. After passing through the hands of the Innes family, it became the property of the Clan Sinclair of Geanies through the marriage of the daughter of Alexander Sutherland to the first Sinclair Earl of Caithness. The Sinclairs replaced the existing structure with a four-storey tower house that forms part of the current castle in 1620. In 1650 Dunbeath was attacked and captured (along with Lady Sinclair) by James Graham, 1st Marquess of Montrose and not returned to the Sinclairs until the defeat of Montrose at the Battle of Carbisdale in 1650.
The castle was extensively remodelled in the 17th century by Sir William Sinclair and again in 1853 and 1881. In 1945 after 325 years of occupation by the Sinclair Family, the castle was sold to Stuart Avery.
The castle remains a private residence today and is not open to the public.