The Aboriginal Australian people who are the traditional owners of the land on which Ardrossan was developed were the Narungga people. They comprised four clans sharing the Guuranda (the Yorke Peninsula): Kurnara in the north, Dilpa in the south, Wari in the west and Windarra in the east.
The first European settlers after the British colonisation of South Australia were pastoralists who established sheep runs. Pastoral Lease No. 232, comprising 27 square miles (70 km2), was taken up in 1852 by William Sharples. Stretching along the coastline, this was known as Parara (or Parrana/Pirana), meaning "middle" in the Narungga language, with the homestead near Parara Landing, about 3 kilometres (1.9 mi) south of present Ardrossan. Northward of Ardrossan are coastal springs, named Tiddy Widdy or Tittiwitti by the Narungga, being a scarce natural source of fresh water in this region.
In 1859 partners Parker Bowman (1831–1911) and Edmund Parnell (c.1834–87) took over the Parara leases. After these expired in 1865 the government moved toward establishing closer settlement and grain farming.
The Hundred of Cunningham was proclaimed on 19 June 1873, comprising 134 square miles (350 km2), and surveying commenced. The Hundred had two government surveyed towns, namely Ardrossan, proclaimed 13 November 1873, and Price, proclaimed 3 August 1882.
Being at a site formerly known as Clay Gully, after a deep gully leading to its red clay coastal cliffs, the surveyed town of Ardrossan was named by Governor Fergusson after the Ardrossan seaport in Scotland which shared similar geography – "ard" meaning a height, and "ros" prominent rock or headland.
The site was largely chosen because of its potential for shipping infrastructure, allowing wheat farmers to ship their produce across the Gulf St Vincent to Port Adelaide. The residents of the new township petitioned the government for a jetty in 1874. Completed in 1877, this was later extended to better accommodate the larger steamships and windjammers used to export grain overseas. By 1878 there were six houses, a post office, a flour mill, a Methodist church, and a hotel. That same year a public school opened, having 53 pupils.
During the late 1800s, and into the early 20th century, the town expanded steadily due to income from the surrounding farms. As well, it became notable as the location of Clarence Smith's factory where he manufactured the Stump-jump plough between 1880 and 1935. This South Australian invention was vital in opening mallee country throughout Australia to the plough.
Although the surrounding grain farmers continued to prosper, there was little change in the size of the town during the early 1900s. After the depression in the 1930s, the town and its businesses were largely stagnant until a large open-cut dolomite mine was opened by BHP in the 1950s for use at its Whyalla Steelworks on the Eyre Peninsula and Port Kembla in New South Wales. A new 1-kilometre (3,300 ft) long jetty was added and at the same time construction was started with grain storage silos. The "new" jetty currently services ships loading dolomite, grain and salt from the solar salt pans at Price, located approximately 10 kilometres (6.2 mi). The wharf is located 1.5 kilometres (0.93 mi) south of the town jetty, and can accommodate vessels of Handymax class.
The wharf was being considered for the future export of iron ore and copper concentrates by Rex Minerals Ltd in 2013.