This was the second election to the district council following the local government reforms in 1974.

The election used the original 12 wards created by the Formation Electoral Arrangements in 1974 and two wards added to the district council due to boundary alterations between Sutherland and Caithness District Councils.

Each ward elected one councillor using first-past-the-post voting.

Prior to the election, alterations were made to the area controlled by Sutherland and Caithness District Councils.

An area in the west of Caithness including Tongue, Farr and Strathy was transferred to Sutherland.