Although Aberdeenshire lies north of the Highland boundary fault, it mainly comprises an agricultural lowland drained by rivers that generally flow east. The land is in the rain shadow of the Grampians, resulting in a generally dry climate with parts of the coast receiving less than 25 inches (640 mm) of precipitation annually. Temperatures are warm for the latitude, but exposure to cold winds from the north and east produces winters that are harsh by British standards.

Although one or two long cairns from the Neolithic Period survive, the effective settlement of the area dates from the establishment of the Beaker culture, arriving from the south at the commencement of the Bronze Age (c. 2000–1800 BC). The stone circles and round cairns that are so common in the historic county date from this period. Numerous earthen houses and a group of massive stone hill forts survive from the Iron Age. At the dawn of history, Celtic tribes that the 2nd-century Greek geographer Ptolemy called Taixali occupied the historic county. Later, Aberdeenshire formed part of the territories of the northern Picts (Pict). Roman marching camps exist at Culter, Kintore, and Ythan Wells. Christianity spread to the county relatively early, and Celtic monasteries included those at Old Deer and Monymusk.

Aberdeenshire played a part in the long struggle between the rival houses of Canmore and Macbeth. It was at Lumphanan that Macbeth fell in 1057. During the Anglo-Norman penetration, great families such as the Balliols (Balliol family), the Bruces (Bruce family), and the Comyns obtained a footing in the shire. When the contested succession between these three houses resulted in the Scottish Wars of Independence, the English king Edward I twice traversed the county, in 1296 and 1303. Robert the Bruce (Robert I)'s victory in 1307 near Inverurie was a turning point in the struggle. His ultimate triumph resulted in the settlement of new families, most notably the Forbeses and the Gordons, who emerged as the principal rivals in the period of feudal strife during the 14th and 15th centuries. The bitterness later intensified when the Forbeses generally accepted the Protestant Reformation while the Gordons adhered to Roman Catholicism. As a stronghold of royalism and Episcopalianism during the English Civil Wars of the 17th century, Aberdeenshire inevitably was the site of much fighting, notably by the army led by the marquess of Montrose (Montrose, James Graham, 5th Earl and 1st Marquess of, Earl of Kincardine, Lord Graham and Mugdock).

Meanwhile, trade with the Low Countries, Germany, and Poland had flourished, and in the 17th century this produced new wealth among some of the ancient county families. The foundation of three universities marked the growth of learning—King's College in Old Aberdeen (1494), Marischal College in New Aberdeen (1593), and the short-lived University of Fraserburgh (1597). The Episcopalianism of the northeast, more receptive to cultural expression than was Calvinism, reached its flowering in the celebrated school of scholars known as the “Aberdeen Doctors.”

From 1690, after settlement of the Glorious Revolution (1688–89), more tranquil conditions prevailed. Still, local devotion to Jacobitism and Episcopalianism persisted and found vent in the risings of 1715 and 1745. Upon the collapse of the 1745 rebellion, the penal laws destroyed the ascendancy of Episcopalianism and the feudal power of the landowners and paved the way for the ensuing era of agricultural and industrial progress.

The economy of the council area rests on a mix of agriculture, fishing, industry, and services. The raising of dairy and beef cattle is the main agricultural activity, but sheep are important on the higher ground. Peterhead and Fraserburgh are among the most important fishing ports in the United Kingdom and are also boatbuilding centres. Elsewhere fishing has declined, and the small fishing villages have turned to tourism; Stonehaven combines both. Tourism is also important in the Grampians and their scenic valleys. Whisky distilling and light manufacturing occur in several towns. However, the exploitation of North Sea oil is probably the single most important economic activity in Aberdeenshire. Pipelines bring oil ashore at Peterhead and St. Fergus (Saint Fergus), and the production of goods and services for the oil industry is important in other parts of the council area. Balmoral Castle, the Scottish Highland residence of the British royal family, stands amid the Grampians in western Aberdeenshire. Aberdeen city is the historic county town (seat) and administrative centre of Aberdeenshire, although it is not part of the council area. Area council area, 2,428 square miles (6,289 square km). Pop. (2001) council area, 226,871; (2006 est.) 238,770.