The river rises on the eastern slopes of the Great Dividing Range, in the Border Ranges west of Bonalbo, near Rivertree at the junction of Koreelah Creek and Maryland River, on the watershed that marks the border between New South Wales and Queensland. The river flows generally south, south east and north east, joined by twenty-four tributaries including the Tooloom Creek and the Mann, Nymboida, Cataract, Orara, Coldstream, Timbarra, and Esk rivers. The river reaches its mouth at its confluence with the Coral Sea in the South Pacific Ocean, between Iluka and Yamba; descending over the course of its length.
On its journey it passes through the towns of Tabulam and Copmanhurst, the city of Grafton, and the towns of Ulmarra, and Maclean. The river features many large river islands, including Woodford, Chatsworth, Ashby, Warregah and Harwood islands; and Susan Island Nature Reserve. The river supports a large prawn trawling and fishing industry.
The Clarence River system is an extensive east coast drainage with many tributaries of differing size. Apart from the Murray River, it is the largest river in mainland Australia south of the Tropic of Capricorn, though its flow for comparison is only half that of the Potomac. Its basin is, together with the very similarly-sized Hawkesbury, Australia's largest Pacific watershed south of Bundaberg. The extremely intense rainfalls that typify the North Coast mean, however, that major floods can temporarily raise the flow of the Clarence to levels equivalent to some of the largest rivers in the world.