A meteor made entirely out of clay crash-lands on the grounds of a humble American circus. The goo from the interstellar object contaminates all of the circus' attractions, transforming them into bizarre caricatures of their former selves, with new superpowers.

The game features eight playable characters and one boss character:

Bad Mr. Frosty - A snowman with a bad attitude. His special attacks include throwing snowballs, spitting sharp balls of ice, sliding along the ground and kicking his opponent, and turning into a snow boulder and rolling into his opponent. His arena in 1-player mode is an icy lake in front of an ice block castle with penguin spectators.

Blob - A blob of clay. A self-proclaimed master of "goojitsu," his specialty is "morphing" into objects to attack his opponent, with his specialty being transforming into a buzzsaw and cutting his opponent in half. He is said to be highly intelligent, despite being made up of the slimy dregs of the mutagenic meteor. His arena is a pool of green slime.

Blue Suede Goo - An Elvis impersonator with wildly exaggerated features, including a big gut and even bigger hair. He throws musical notes at his opponent and uses his hair as a blade. He fights on the keys of a flaming piano with the words "Big Hunk O' Burnin' Clay" (A parody of the Elvis song "Hunka Hunka Burnin' Love") on it. His name is a parody of the song "Blue Suede Shoes."

Bonker - A cheerfully manic clown whose arsenal includes deadly pies, killer cartwheels, a spraying flower, and the big hammer that gives him his name. He will fight in two funhouses, one resembling a clown head, the other resembling a bubble-spewing rubber duck (Although their interiors are the same, save for a palette swap).

Helga - An obese opera singer with incredibly large breasts. She is Blue Suede Goo's rival and attacks by hurling herself at her opponents, stabbing them with the horns on her helmet, and by hitting that high note for a sonic scream. The first foe in 1-Player mode, she will fight the player on stage at an open-air opera theatre.

Ickybod Clay - A ghost with a pumpkin head. He can teleport and throw balls of ectoplasm at foes. His name is a play on Ichabod Crane from Sleepy Hollow, and his pumpkin-head is based on the Headless Horseman from the same tale. His arena is a haunted house.

Taffy - A fighting piece of taffy whose attacks mainly involve stretching and twisting his thin but super-flexible body. As a result, Taffy uses some of the longest-reaching moves in the game. He can also twist himself tightly to cause himself to spin at his opponent while his arms flail. In 1-player mode, he will fight in two overflowing taffy factories.

Tiny - A wrestler-type character who does not really rely on wrestling. Instead, he uses his big fists to charge across the screen and punch, as well as rolling himself into a ball and flinging himself at foes. Another foe with two palette-swapped arenas, he will fight in a wrestling ring or at a coliseum.

N. Boss - The final boss is an odd necklace-like creature. Looking like nothing so much as a string of pearls with two round eyes (one wide-open, one half-closed), N. Boss only attacks with projectiles copied from other characters and a grab attack. Unlike the other characters, he does not appear to be made of clay and the announcer does not announce his name at the start of the match (similar to Master Hand from Super Smash Bros.) or when he wins, both suggesting that he was thrown in at the last second just to have a final opponent to face. N. Boss uses the purple meteor itself as his arena, although it is actually a pallet swap of The Blob's. His name is a pun, poking fun at both M. Bison from Street Fighter II and the phrase "end boss."

ClayFighter was followed by a tournament edition, then two sequels, C2 Judgement Clay and ClayFighter 63⅓ for the Nintendo 64, which had its own special edition version only for rent at Blockbuster Video stores in America. This "Sculptor's Cut" edition included bonus fighters cut out of the original release for 63⅓, including Lady Liberty, High Five, Lockjaw Pooch, and Zappa Yow Yow Boyz. Many special attacks that the characters used were removed and the combo system was also altered. While the game was a rental exclusive, although rare, it is not uncommon for people to have the game. For example, many Blockbusters liquidated their stock of rental copies and sold them in their stores as a used game.

On September 15, 2009, Interplay announced a return of ClayFighter for WiiWare and DSiWare. The game is named as Clay Fighter: Call of Putty a joke with Call of Duty.

Clayfighter: Tournament Edition

Clayfighter: Tournament Edition was a Super Nintendo exclusive fix of the original with many things changed, such as:

• Most stages from the original were modified. The stages were either slightly edited, some redone from scratch.
• Many glitches from the original were fixed. Notably, the glitch to play as N. Boss was removed.
• Many new modes were added, more versus modes were added, since it is a 'tournament' edition.
• The intro and title screen were edited.

ClayFighter was awarded Best Street Fighter Wannabee of 1993 by Electronic Gaming Monthly. They also awarded it Best Sound Effects, as well as awarding it for having the Best Ad.

In the 1995 PC game Shannara, a game based on Terry Brooks's Shannara book series, choosing to attack the clay formed by pouring water on the ground will yield a message informing the player that "...this isn't Clay Fighter!".

• List of fighting games