Clarke received early encouragement in his writing in high school, and in college won prizes for several of his poems. Clarke went on to write as a journalist before settling on fiction as his preferred genre.

Clarke is known for his novels and short stories which focus on the struggles of black people attempting to succeed in white society. Anthony Boxill notes that Clarke ‘‘became the foremost recounter of the black West Indian immigrants' experience in Canada.’’ Boxill describes the overriding tone of Clarke's fiction in regard to race relations: ‘‘Of his generation of West Indian novelists he is perhaps the most outspoken and bitter in depicting the experience of the poor black when confronted with the establishment, whether it is that of the white majority in Canada, the colonial expatriate, or the postcolonial ruling black middle class in Barbados.’’

Clarke's first novel, The Survivors of the Crossing, was published in 1964, ten years after his arrival in Canada. It concerns the conditions of sugar plantation workers in Barbados. In this novel, the main character, Rufus, tries to organize sugar plantation laborers, but is discouraged both by the institutional powers of a white ruling class and also by members of the black middle class. His second novel, Thistles and Thorns, is also set in Barbados and centers on a boy, born illegitimate, who leaves the home of his mother in order to find his father. These novels were received by critics as flawed, but certainly the work of a promising author. As with most of Clarke's works, critics generally agreed on Clarke's talent for capturing the rhythms of Barbadian speech and for his depiction of comic scenes. However, as Boxill explains, ‘‘they are weakly structured and lack aesthetic distancing and tonal discipline.’’ Clarke's characters also tend to fail to draw the reader in.

In his first two novels, Canada represents a promised land of escape from economic and social woes. His next three novels depict what immigrants from Barbados find when they reach Canada. His Toronto Trilogy is comprised of a series of three novels about immigrants from Barbados to Canada. These novels generally portray the condition of West Indian immigrants to Canada in terms of their struggles with racial prejudice and economic hardship. The first in the trilogy, The Meeting Point, was published in 1972. It centers on a woman who is a black immigrant from Barbados and who works as a maid for a Jewish family in Toronto. The second, Storm of Fortune, was published in 1973. It includes some of the same characters as the first, but after they have achieved a degree of financial success and harbor expectations of assimilating into mainstream culture. The third, The Bigger Light, was published in 1975. It centers on a man, an immigrant from Barbados, who becomes alienated from his family and his culture in the process of attempting to succeed in white society. While critics continued to admire Clarke's facility with the dialect of Barbados, his plot structures in the Toronto Trilogy were criticized as contrived to suit his social message.

Clarke's collections of short stories include When He Was Free and Young He Used to Wear Silks (1973), Short Stories of Austin Clarke (1984), When Women Rule (1985), Nine Men Who Laughed (1986), In This City (1992), and There Are No Elders (1993). His talents as a short story writer are indicated by the fact that in 1965 he won the University of Western Ontario President's Medal for the best story published in Canada that year. Clarke's autobiographical work Growing Up Stupid under the Union Jack: A Memoir (1980) has been generally praised. Boxill states that in this work ‘‘Clarke is once again at his best. . .Full of humor and vigor, it recreates the world of his boyhood with much affection but without glossing over the injustice and brutality with which the society treated the poor and the black. One has the feeling that far from forcing his material into a predetermined rigid mold, the author has allowed this book to grow organically.’’