Davidson was born in Cowford, in the Parish of Bellie, Moray, Scotland, and was engaged in salmon fishing as a young man (see River Spey).
In 1765 he arrived in Nova Scotia and obtained extensive land grants, he and a partner getting 100,000 acres (400 km2), of which 2/3 was Davidson's share.
This amounted to a strip of 13 miles (21 km) on either side of the Miramichi River (then a part of Nova Scotia) with fishing and lumbering rights.
To employ his workers in the winter he began to cut lumber and brought out from Great Britain a master shipbuilder, shipwrights and other craftsmen.
In 1776 the American Revolutionary War, came along and New England privateers made sailing in the North Atlantic unsafe and rebel sympathizers stirred up the neighbouring Mi'kmaq Indian nation.
The Mi'kmaq began raids on the Miramichi settlers, and in 1777 Davidson withdrew inland with his employees to Maugerville, a settlement on the Saint John River downstream from the site of present city of Fredericton, New Brunswick.
In 1783 Davidson was elected a member of the 5th General Assembly of Nova Scotia for Sunbury County which, in 1784, became part of New Brunswick.
[1] The American Revolutionary War was now over and Davidson moved back to the Miramichi Valley to secure his land grants.
William Davidson was elected as representative from Northumberland County to the 1st New Brunswick Legislative Assembly and served from 1786 until his death.
He was, perhaps, the first English speaking person to establish a significant commercial lumber business in Canada.