The circuit opened in September 1974, created by joining service roads to a nearby disused mineral railway that had served Lethans Colliery and had been closed in 1951. The first car race was held on 18 May 1975. Between 1974 and 1983 the circuit had several owners who steadily developed its facilities. Derek Butcher became owner in 1984, and under his stewardship the circuit was developed to a level capable of hosting rounds of major British car and motorcycle championships.
The circuit has three layouts: the 1.300 mi (2.092 km) International layout with 9 corners, the 1.000 mi (1.609 km) National layout with 10 corners, and the 0.300 mi (0.483 km) tri-oval. All layouts share a width of 10 m (33 ft) and a total elevation change of 37 m (121 ft).
A lap of the International layout begins at the start line, which is situated at a different point from the finish line — the start line is roughly in the middle of the pit straight, the finish line slightly to the west towards the final corner. The lap proceeds over the crest (the circuit's highest point), levels out and passes under a pedestrian bridge, then arrives at the first corner, Duffus Dip: a fast, blind-apexed downhill right-hander widely regarded as one of the most challenging corners in the United Kingdom. At the foot of the decline is a quick left-hand corner named Leslie's, followed by a braking zone for McIntyre's, a ninety-degree right-hand bend. A short straight leads to Butcher's, a shallow right-hander, after which the track dips to its lowest point before rising to the Chicane — a two-part corner where the second, right-hand apex is completely blind, frequently sending cars through on two wheels. After the short back straight comes Clark's, a blind uphill right-hander. Next is Hislop's (formerly Railway), a left-handed kink taken at relatively high speed, whose name references the old railway line beneath that section. The second-longest straight, also named Railway, leads to the final corner, Taylor's hairpin — one of the tightest hairpins found anywhere in the UK, with an uphill apex and formerly known as the Real Radio Hairpin for sponsorship reasons. Taylor's is considered the best overtaking point on the circuit. Vehicles then accelerate on the partly uphill pit straight to the finish line.
The circuit hosted a round of the British Touring Car Championship for twelve years until the deal ended in 2002, when promoters sought infrastructure upgrades. Following improvements, the touring car series returned to Knockhill in 2004 with ITV televising live. The British Formula Three Championship and British GT Championship returned in May 2005.
In 2012, the circuit restarted racing and track days in the anti-clockwise direction and gained a licence for motorbikes and cars to compete in both directions — the first circuit in the UK to achieve this in modern times. The main recurring championship events are annual rounds of the British Touring Car Championship and British Superbike Championship.
In 2008, Knockhill named a corner Leslie's Bend in honour of racing-car driver David Leslie, shortly after his death in a small jet-aircraft accident at Farnborough.
Beyond the main circuit the venue includes a concrete rally stage south of the hairpin, a 500-metre karting circuit east of the main paddock, a skid pan, an offroad course north of the main circuit, and an infield Rallycross course reprofiled in 2019. Track-driving experiences are offered using a Ferrari F430, Aston Martin Vantage, Legend race car, Honda Civic Type Rs, and Audi-powered Van Diemen single-seater formula cars. Rally experiences run in modified Ford Fiestas, and skid-pan and offroad experiences are also available. Motorsport taster days for people with disabilities and driving experiences for those too young to hold a licence are offered. On-site parking accommodates 3,000 cars.
The circuit was the location for Kaiser Chiefs' "Hole in My Soul" music video, part of their Stay Together album. It appears in several video games including Project CARS 2, Colin McRae: Dirt, and games in the TOCA series. It featured on television in Episode 7 of Series 8 of Top Gear, the first episode of Idris Elba: No Limits, and in The Grand Tour presents: Lochdown.
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