The Deanston Distillery was built within a cotton mill designed by Richard Arkwright in 1785, the pioneer of steam-powered textile manufacturing. This is a typical example of a mill converted into a distillery, with several such distilleries in Scotland for the simple reason that both require large quantities of fast-flowing, pure water. The cotton mill stood on the banks of the River Teith, near the picturesque Doune Castle, and operated until 1965. The conversion into a distillery was the idea of Brodie Hepburn Ltd (a Glasgow whisky merchant, owner of the Dumbarton Distillery in 1953, and builder of the Macduff Distillery in 1963). They partnered with the mill's owners, James Findlay & Company, acquiring a 30% stake. The water turbine and backup generator were already in place, but four solid floors had to be removed to make room for two pairs of stills. The distillery was commissioned in October 1969, and the first Deanston single malt whisky was released in 1974. The initial plan was to link the production and development with a main blended whisky brand (Old Bannockburn), but this proved unsuccessful. In 1972, Invergordon Distillers took control of Deanston Distillery. The distillery remained silent from 1982 to 1990, until Burn Stewart Distillers purchased it for £2.1 million in cash and resumed production. Burn Stewart was acquired in 2002 by C.L. World Brands, headquartered in Trinidad, which was subsequently acquired by South Africa's Distell Group.

Dean and Doune derive from the Gaelic word 'dun', meaning 'hill fort'. Doune Castle is one of the largest and best-preserved, best-restored late-14th-century Scottish military buildings (The Blue Guide to Scotland). Doune Castle was used as a filming location for Arthur's Castle, Castle Anthrax, and Castle Swamp in the 1974 film Monty Python and the Holy Grail! Brodie Hepburn Ltd advertised in the Scottish Licensed Trade News (1966) claiming to be the 'oldest established whisky merchant'. The company was acquired by Invergordon Distillers in 1971. Burn Stewart Distillers' history dates back to the 1940s, with the management led by Bill Sanderson acquiring and creating the current company in 1988. They paid £7 million. The company went public three years later with a market value of £83 million, allowing directors to build offices and bottling facilities in East Kilbride between 1992 and 1993 (expanded in 1995). The company bought Tobermory Distillery in 1993. In 2003, they acquired Bunnahabhain Distillery and its successful Black Bottle blend. The company's blends are blended in Airdrie, where there is extensive storage space. The interior of Deanston Distillery appears in Ken Loach's film The Angels' Share.