Williams was born in Plaquemine, Louisiana, ran away from home at age 12 to join Billy Kersand's Traveling Minstrel Show, then moved to New Orleans in 1906. At first Williams worked shining shoes and doing odd jobs, but soon became known as a singer and master of ceremonies. By the early 1910s he was a well regarded local entertainer also playing piano, and was composing new tunes by 1913. Williams was a good business man and worked arranging and managing entertainment at the local African-American Vaudeville theater as well as various saloons and dance halls around Rampart Street, and clubs and houses in Storyville.
Williams started a music publishing business with violinist/bandleader Armand J. Piron 1915. He toured briefly with W.C. Handy, set up a publishing office in Chicago, then settled in New York in the early 1920s. He supervised African-American recordings for New York officies of Okeh phonograph company in the 1920s; also lead bands frequently for Columbia and occasionally other record labels. He also produced and participated in early recordings by Louis Armstrong, Sidney Bechet, Bessie Smith and many others.
In 1943 Williams sold his extensive back-catalogue of tunes to Decca Records for $50,000 and retired, but then bought a bargain used goods store which he ran to keep himself busy. Williams died in Queens, New York City in 1965.
Clarence Williams' name appears as composer or co-composer on numerous tunes, including a number which by Williams' own admission were written by others but which Williams bought all rights to outright, as was a common practice in the music publishing business at the time. Clarence Williams hits include "I Wish I Could Shimmy Like My Sister Kate", "Baby, Won't You Please Come Home", "Royal Garden Blues", "Tain't Nobody's Business If I Do" and many others.