It was organized in June 1873 and was named for William Z. Clayton, who owned a large tract of land there at the time.

Clayton and Bennington are still the least populated townships of the county with 178 people each.

According to the United States Census Bureau, the township has a total area of 36.2 square miles (94 km2), all land.

14.3% of all households were made up of individuals, and 5.4% had someone living alone who was 65 years of age or older.

About 2.1% of families and 5.2% of the population were below the poverty line, including 6.2% of those under the age of eighteen and none of those 65 or over.