The castle was an old seat of the Mormaers and Earls of Ross, chiefs of Clan Ross. It was later held by their successors, the Clan MacDonald, Earls of Ross. Alexander MacDonald of Lochalsh, chief of the Clan MacDonald of Lochalsh and relative of the MacDonald Earl of Ross and Lord of the Isles held a Christmas feast at Balconie in 1485. He invited all of the dependants of his own clan and many highland chieftains and guest, including Kenneth Mackenzie heir to the chiefship of Kintail Clan Mackenzie and his wife who were residing on the island of in Kinellan Loch, one of the old hunting lodges of the Earls of Ross. Kenneth arrived at the feast with 40 men but without his wife. This was taken as a great insult to the MacDonalds. To make matters worse Maclean of Duart Clan Maclean who was responsible for the arrangements and who previously had a quarrel with Kenneth purposely assigned him to the kiln as a lodging place at Balconie. Kenneth was now the one insulted and fought Maclean who was an important vassal of the Macdonalds. Maclean's retainers looked upon this as an act of war and at once drew swords. Mackenzie and his men made a wise retreat to the shores of the Cromarty Firth and returned Kinellan.
From the late 15th to the end of the 17th century the castle was held by a cadet branch of the Clan Munro; the Munros of Coul and Balconie, who descend from George Munro 10th Baron of Foulis Castle, chief of the clan. Balconie Castle's owners were chronologically; John Munro 1st, John Mor Munro 2nd, John Munro 3rd, Hugh Munro 4th, Robert Munro 5th, Donald Munro 6th and John Munro 7th, all of Balconie. John Munro 7th of Balconie sold the lands.
Later the castle went through a period of Mackenzie ownership and an interlude of Fraser ownership in the 19th century which saw the nearby village of Evanton laid out. See:Evan Fraser of Balconie.
Alterations and additions were documented in 1891 by architects Andrew Maitland & Sons.
By the start of the Second World War, the castle was owned by one George Bankes and used as a summer home. During the War, the building was requisitioned by the army and used as a billet. After the war, the castle was bought by A.J.M. Munro, a timber merchant from Alness, and lay empty for some years, dry rot being only one of the problems. It fell into disrepair and by the 1960s was unsafe. Local children were prone to explore the place and to prevent a serious accident, it was demolished. The rubble was used in the construction of the new aluminium smelter a few miles away at Invergordon. Nothing is left of the building - it is just a field. A small ice-house remains. The location was approximately grid reference . However, the castle's walled garden and stables survive and is privately owned.
- Evanton was established by Alexander Fraser of Balconie, who named it after his son, Evan.
- Munro, R.W. (1975). Clan Munro Magazine No. 13. pp. 34 to 35.
- Mackenzie, Alan. (2006). History of the Mackenzies. Chapter 3.
- Munro, R.W. (1975). Clan Munro Magazine No. 13. pp. 34 to 36.
- "DSA Building/Design Report". Dictionary of Scottish Architects. Retrieved 2008-03-12.
- Munro, R.W. (1975). Clan Munro Magazine No. 13. pp. 34 to 38.
- Interview with Alastair and Mora Munro 11 June 2007