Old Woodhouselee Castle is thought to have been built by Oliver Sinclair in the first half of the 16th century. Now in ruins, all that remains are three large subteranean vaults measuring some 19 metres long by 6 metres wide and around 2.7 metres high. At the north-east end of the site, level with the top of the vaults, are the foundations of a building measuring around 5.0 metres by around 6.0 metres, meaning the castle originally formed an L-plan.

The castle would have commanded a prime defensive spot, standing high on a rocky promontory overlooking the River North Esk below. During the 16th century the castle became the property of James Hamilton of Bothwellhaugh when he married Woodhouselee's heiress Lady Anne Sinclair of the Rosslyn family. Hamilton would later become infamous as the assassin of James Stewart, 1st Earl of Moray, the Regent of Scotland at the time and half-brother of Mary Queen of Scots, in what was the world's first recorded assassination by firearm.

The castle was burnt to the ground by Moray's followers in an act of revenge, and has remained uninhabited ever since. In 1665 some of the stone from Old Woodhouselee was removed to repair Fulford Tower.