The history of the town of Clyde (known also as Dunstan and Hartley's in its early years) is intrinsically linked with the history of the discovery and mining of gold in Central Otago. Gold mining began in Central Otago with Gabriel Read's discovery of gold in Gabriel's Gully, near present-day Lawrence, in 1861. The following year Hartley and Reilly left this gully and travelled further into Central Otago. They spent the winter prospecting in the now-flooded Clutha Gorge between present day Clyde and Cromwell, finding enough gold in the area to travel back to Dunedin and lodge 87 pounds with the Gold Receiver. The 1862 discovery precipitated a rush to the area. A ragged canvas town quickly sprang up, and by December of that year between six and seven thousand miners and settlers occupied Clyde and the surrounding areas. Sunday afternoons would see up to 4000 men congregate in the town. At Christmas 1862, 320 people sat down to dinner at one of the “innumerable” hotels. While Clyde was itself the centre of mining activity in 1862, as gold was quickly discovered in other parts of Central Otago such as Arrowtown and Queenstown it was also the source of supplies for those travelling on to other areas. By the late 1860s photographs show a row of single-storied wooden buildings running cheek-by-jowl along the main street, now known as Sunderland St, hotels prominent amongst them. A photograph dated c. 1862 shows a profile of canvas and wooden buildings along the terrace above the river where the town now stands, and a small collection of wooden structures on the lower beach . McCraw gives a date of 1865 for the same photograph, a more likely date given the number of structures and roads visible, and has annotated it with details of the infrastructure used to mine a seam of coal along the riverbank. By the late 1860s photographs show a row of single-storied wooden buildings running cheek-by-jowl along the main street, now known as Sunderland St . The buildings all feature flat-fronted facades with business signs, among them one named the Dunstan Hotel, and the Hartley Arms Hotel can be seen several doors along. These were just two of many hotels in the town. Veitch provides a detailed description of the history of the Dunstan Hotel, more commonly known simply as “the Dunstan”. The original building had a dining, drawing and smoking room as well as a theatre for Saturday night entertainment with a brass band and dancing girls. It also functioned as the booking office for Cobb and Co's coaches, and provided accommodation for travellers, which explains the horse-drawn coaches laden with passengers that can be seen in two photographs of this earlier building, constructed from weatherboard, with arched windows and imitation wooden quoins on the corners. Coaches then took three days to reach Clyde from Dunedin. Stabling was also provided, as the sign still visible on the side of the building today demonstrates and the horses cared for by the services of a groom. Land Information New Zealand records relating to the site of Dunstan House begin with Crown Grants for sections 10 and 11 to two different land owners, Cannon and Atkins in 1866. Both these men sold to William George, Atkins in 1867 and Cannon in March 1869. However George was evidently in possession of the Hotel before 1867. On 26 October 1866 the Dunstan Times gave an account of the effects of an earthquake that shook “George's Dunstan Hotel” as carpenters were working on extensive renovations. In 1878 William George still owned the Dunstan Hotel and in this year borrowed a mortgage of approximately £200, adding to an earlier mortgage borrowed in 1869 of £120. At the same time he gifted all his property to his wife Emma. Emma George declared herself bankrupt seven years later in April 1885, when mortgagors sold the property to Benjamin Naylor, the storekeeper directly across the road. Naylor kept the property for four years, selling it 1899 to Alderdice. Alderdice must have immediately begun the rebuilding of the hotel in stone, in its current form. Secondary sources state that the hotel was rebuilt in 1900 in schist cut from the rock face at the gorge end of the town, and the stables at the rear were also rebuilt in stone. Thomas Wilkinson the stonemason lived at St. Bathans and had worked on the restoration of Edinburgh Cathedral before coming to New Zealand in search of gold. He was assisted by apprentices and stonemason John Holloway, who built many of the Clyde houses, as well as Albert Fountain, who made the joinery and built the elegant staircase. The same craftsmen were subsequently engaged to build the neighbouring Commercial Hotel. Photographs taken after the turn of the century from the hill above the town show the transition made at this time from the earlier flimsy wooden single storey structures to more substantial stone buildings, the two storeyed Dunstan and Commercial Hotels standing out above the rest. While Alderdice remained the owner of the hotel until 1920, he leased it to a number of different proprietors, beginning with Grant in November 1902. The first undated photograph of the stone replacement building shows the name “Dunstan Hotel” along the front, and the name of Thomas Grant over the door. A small upstairs balcony with only a window opening on to it stands above the doorway, since replaced with a large veranda. A somewhat later photograph (also undated) shows the same detail of the building, with a long-skirted woman standing on the balcony, reached through the open window behind her. The caption states “Dunstan Hotel first motor coach”, an early bus parked outside, along with a car. The motor coach suggests that the Dunstan Hotel was still the coach depot at this time, as does the earlier photograph with the coach and horses. The proprietor's name over the doorway is now “Mack's” . Mack leased the hotel from Alderdice between 1913 and 1920, and in 1913 mortgaged the property to Speights. After Alderdice sold in 1920, the hotel changed hands many times. By 1937 the town was no longer able to support the number of hotels it once had. Gold mining in Central Otago generally had ended by the late nineteenth century. The Dunstan Hotel license was given up and the name transferred to the former Commercial Hotel, several doors along on the corner of Sunderland and Naylor streets. Veitch states that the following thirty years “were sad ones for the old house”. It was used as two flats for a period of time, but deteriorated until it was used only for storage. There was no plumbing or functioning bathroom or kitchen and rooms were badly water damaged. In 1968 it was purchased by Fleur and Jim Sullivan, who restored and renovated the building and began its use as a bed and breakfast business, with an antiques and craft shop in the former bar and billiards room. In 1974, the Sullivans sold Dunstan House and Fleur Sullivan went on to extend her fame in the hospitality industry, with the development of Oliver's restaurant in the former store of Benjamin Naylor, across the road from Dunstan House. Since this time Dunstan House has changed hands several times, continuing as a bed and breakfast business. In December 2000 it was purchased by the current owners, and operates as a boutique guest house.

The former Dunstan Hotel is a two-storeyed, square-fronted building with a veranda on the first floor. The hotel's former stables, now converted for accommodation, are at the rear, reached either via a side alley way or from Miners Lane that runs behind Sunderland Street above the river, servicing the rear of the Sunderland Street businesses. The hotel is built fronting directly onto Sunderland Street, Clyde's main thoroughfare. It has two entrances onto the street. A doorway at the north-east corner of the building opens directly into the restaurant, while the main central doorway on the north-east elevation opens into an entranceway. A central landing leads to the staircase and ground floor rooms. On the ground floor is the kitchen and restaurant, large sitting room for guests, a small television lounge and a guest bedroom. On the first floor are the guest rooms, most with ensuite bathrooms. The elegant wooden staircase to the first floor is in the centre of the building, with a large coloured glass skylight in the roof above it. The building has several chimneys with fireplaces (no longer in use) on both floors and ten guest rooms in total. The Dunstan Hotel forms an integral part of the Clyde streetscape. Other buildings in Sunderland Street still stand from Clyde's early days as a frontier town and retain the character that can be seen in 1860s photographs. Several doors to the east of Sunderland Street the former Commercial, Hotel stands on a prominent corner. The two buildings make an impressive pair standing out above the other single storeyed structures in the main street. They are both constructed of the schist, and built at about the same time by the same workmen, replacing earlier hotel buildings dating to the first years of occupation of Clyde. Although not registered with NZHPT, the building of the Hartley Arms Hotel still stands several doors down from the former Dunstan Hotel, its original stone now disguised with a roughcast exterior.