In September 1948, a committee consisting of Manuel Alvarado, Noble Naylor, and W. Marion Smith, members of the Clayton Lions Club, met with the members of the Town Council for a discussion relative to obtaining the services of a night watchman for police protection.

At a special meeting of the Town Council held on December 20, 1948, the decision was reached to employ an officer whose duties would commence in the early evening and end shortly after dawn.

With an increase in traffic violations in the Town, difficulties were presented for the law enforcement officer in the apprehending of violators; and the purchase of a police car was authorized by the Town Council in 1952.

In 1956 the Town Council authorized the  purchase a recent model police car in order to cope with the increase in the speed of violators and the inadequacy of the existing vehicle in overtaking traffic violators.

In order to still further increase the efficiency of the local law enforcement officer, it was decided to install a police radio so that close communications could be had with the Delaware State Police and other police agencies in the vicinity. This was installed in 1957.

At a regular meeting of the Town Council on May 13, 1957, a Police Commission was created consisting of two (2) members of Council to formulate rules, regulations, general orders, special orders, issues bulletins, and any other matters relating to the guidance and observance of the local law enforcement agency.

Over half of a century later in 2008, the Clayton Police Department is a full 24-hour service police department that employs nine (9) full-time personnel that includes:
The primary function of the Clayton Police Department is to provide the citizens of the Town of Clayton with around-the-clock police protection by enforcing Delaware State Laws and Town Ordinances. Police officers respond to calls for service, investigate all crimes committed in Town limits, and apprehend local fugitives. Further, the Clayton Police Department conducts property checks of both residences and businesses for the Town of Clayton.

The Clayton Police Department also provides community policing support to the Town of Clayton. The Community Policing Unit provides instruction in both the D.A.R.E. and G.R.E.A.T. programs. The Community Policing Unit also provides support in child identification and various safety programs.