Originally Clarence Dock was constructed for the transportation of goods and commodities to and from Leeds city centre, using the Leeds and Liverpool Canal and the Aire and Calder Navigation.

Like the Middleton Light Railway it was primarily used to bring coal from the colliery around Rothwell and Wakefield to supply the heavy industry in Hunslet and business and commerce in Leeds city centre.

The Western side of the dock (the side of Livingstone House) formerly sited a large crane which was on movable tracks along the side of the dock. This was used for the loading and unloading of goods from the canal barges. Until recently the surrounding area was made up of Victorian industrial buildings, albeit throughout the 1990s most were derelict.

Throughout the second half of the 20th century the area suffered steady industrial decline. The mills and many of the heavier engineering works began to either close, move further out of town or scale down. The docks managed to survive the Victorian canal decline, after the introduction of rail freight, however the move to road freight in the twentieth century killed trade at the docks.

By the 1990s, the docks were barely used for the movement of any freight and most of the industrial buildings around the dock laid derelict. The building of The Royal Armouries marked the start of the redevelopment of the area, with the museum opening in 1996.

In 2001 Express by Holiday Inn and a multi-storey car park opened. The original car park for the museum has since been paved and converted into a pedestrianised square called Royal Armouries Square, with car parking for the museum now within the new multi-storey car park.  With 1,100 one and two bedroom apartments, 30 retail and restaurant units and 100,000 square feet of A grade commercial office space, Clarence Dock officially opened in October 2008.