As Dave Rolinson's book (see 'Further reading', below) on Clarke details, between 1962 and 1966 Clarke directed several plays at The Questors Theatre in Ealing, London. Between 1967 and 1969 he directed various ITV productions including plays by Alun Owen (Shelter, George's Room, Stella, Thief, Gareth), Edna O'Brien (Which of These Two Ladies Is He Married To? and Nothing's Ever Over) and Roy Minton (The Gentleman Caller, Goodnight Albert, Stand By Your Screen). He also worked on the series The Informer, The Gold Robbers and A Man of Our Times (but not, as Sight and Sound once claimed, Big Breadwinner Hog). Clarke continued to work for ITV through the 1970s but now made much of his work for the BBC. This included pieces for The Wednesday Play (Sovereign's Company 1970), Play for Today and Play of the Month (The Love-Girl and the Innocent, 1973 and Danton's Death, 1978). Distinctive work for these strands included further plays by Minton including Funny Farm (1975) and Scum (further details below), but also Sovereign's Company (1970) by Don Shaw, The Hallelujah Handshake (1970) by Colin Welland and Penda's Fen (1974) by David Rudkin. He also made To Encourage the Others (1972), a powerful drama documentary about the Derek Bentley case, the case which was later dramatised in the 1991 film Let Him Have It by Peter Medak, and several documentaries, including Vodka Cola (1981) on multinational corporations.

A number of his works achieved notoriety and widespread criticism from the conservative end of the political spectrum, including Scum (1977), dealing with the subject of borstals (youth prisons), which was banned by the BBC, and subsequently remade by Clarke as a feature film released in 1979 (the original television version was only screened after his death). Clarke directed the television play Made in Britain (1982), starring Tim Roth (in his television debut) as a racist skinhead and his negative relationship with authorities and racial minorities, from a screenplay by David Leland. The feature film Rita, Sue and Bob Too (1987), was adapted by the working class Writer Andrea Dunbar from her stage work.

Clarke's work in the 1980s is fiercely stark and political, including the David Leland plays Beloved Enemy (1981) on multinational corporations and Psy-Warriors (1981) on military interrogation. But he also directed David Bowie in Baal (1982) for the BBC, part of Clarke's interest in Bertolt Brecht. His film work became more sparse, culminating in Contact (1985) on the British military presence in Northern Ireland, Billy the Kid and the Green Baize Vampire (1985), Road (1987) and his short film (lasting only 40 minutes) Elephant (1989) which dealt with 'the troubles' in Northern Ireland and featured a series of shootings with no narrative and hardly any dialogue; all were based on accounts of actual sectarian killings that had taken place in Belfast. The film took its title from Bernard MacLaverty's description of the troubles as "the elephant in our living room" – a reference to the collective denial of the underlying social problems of Northern Ireland. His final production, The Firm (1989), covered football hooliganism through the lead character played by Gary Oldman, but also the politics of Thatcher's Britain.

Clarke died on 24 July 1990 after suffering from lung cancer. He was 54.

In 1991 a documentary on him Director Alan Clarke by Corin Campbell-Hill aired on British TV.

Clarke inspired a generation of actors, Writers and Directors, including Paul Greengrass, Stephen Frears, Tim Roth, Ray Winstone, Gary Oldman, Danny Brocklehurst and Iain MacDonald. Filmmakers Harmony Korine and Joel Potrykus have cited Clarke as a major influence on their work. As documented in the series The Story of Film by Mark Cousins, the 2003 movie Elephant by Gus Van Sant about the Columbine High School Massacre was named after and influenced by Clarke's earlier work of the same title, especially by Clarke's penchant for long take tracking shots, often following one or more characters from the rear as they move through space. Critic David Thomson has observed, "No one has ever grasped the central metaphor of cramped existence in walking as well as Alan Clarke."