Son of Alexander Macdonald, 7th Baronet of Slate, and Margaret Montgomerie. Married (1768) to Elizabeth Diana Bosville, with whom he had seven sons and three daughters. Lady Macdonald died in 1789. Lord Macdonald survived her by six years and died in September 1795. He was succeeded in his titles by his son Alexander Macdonald, 2nd Baron Macdonald.
Macdonald was educated at Eton and served with the Grenadier Guards. Macdonald was also a deputy lieutenant of Inverness-shire and a brigadier-general in the Royal Company of Archers. He succeeded his elder brother, James, in the baronetcy in 1766 and in 1776 he was raised to the Peerage of Ireland as Baron Macdonald, of Slate in the County of Antrim.
Boswell and Dr Johnson were met by Sir Alexander and his wife at Armadale on September 2, 1773, as they arrived by boat from Glenelg on their tour of Scotland. The Lord and his Lady had come there on their way from their seat at Mugstot (Monkstadt) on the north part of Skye, to Edinburgh, and therefore had to host Boswell and Johnson at a tenant's house for the ensuing days. Their visit and Boswell's relationship with Sir Alexander were not without friction, and some of Boswell's remarks in his Journal of a Tour to the Hebrides, published twelve years later, resulted in further conflict between the two. For further about the visit to Armadale, see the To the Hebrides edition of Journal of a Tour to the Hebrides, September 2-6, 1773.
Boswell and Macdonald were 13th cousins, sharing a common ancestor in Robert Stewart, 1st Lord Lorne (1382-1449).