Clayton Township was named in honor of William Z. Clayton, a one-time land owner in the area. Clayton was a Maine native who lived winters in Winona and summers in the township for several years. The township was officially organized and named Clayton in 1873 after being known as Providence Township as early as 1858.

From Mill on the Willow: A History of Mower County, Minnesota, Mrs. Hazel Hall recalls her experiences in the rural school in Clayton Township during the late 1800s and early 1900s: "Basket Socials and Pie Socials were held to raise money for school activities. Hot lunches were served in the winter. Many families donated food for the program. When a family butchered a beef, they would bring a large soup bone for the vegetable soup. The older girls would take turns preparing the food for the week. For many years the Lord's Prayer and Pledge of Allegiance to the Flag were recited by all to start the school day. Many religions were represented but no one objected.

"Not having a well on the school grounds, families living a distance would bring the water in five gallon cream cans, traveling in a horse-drawn buggy. They were paid $5 a month for this service.

"Each spring a day was set aside for 'play day' in the districts. It was an all-day affair. Picnic lunch at noon, races, relays, spelling bees and ball games were some of the activities. Parents also attended when pupils and teachers from several districts would gather at one school"