Born in London, the son of a Danish painter and sculptor, Clausen attended evening classes at the South Kensington Schools whilst training with a firm of decorators by day, and did not become a full time painter until 1871, when he acted as assistant to the painter Edwin Long.

In 1882, Clausen was painting in Quimperle at the same time as Stanhope FORBES, and like many others was much impressed by Bastien-Lepage, who he met and about whom he wrote. He was also much influenced by his work with the Hague School. In 1886, Clausen was one of the 'discontents' [fed-up with the fustiness and in-crowd at the RA] who, including several of the Newlyn colony, joined together to create the New English Art Club. The Chantrey Bequest purchased his work The Girl at the Gate (1889) for the Nation, marking the highpoint of Bastien-Lepage's influence upon him.

'A much younger [than Frederic LEIGHTON] but still eminent artist who is not of the Newlyn School sent 3 small pictures to the opening exhibition of NAG in 1895, two being works and studies of a boy and girl, charming, fresh, pure, as far removed as possible from conventional insipidity, and the third, Study of sky, an artists' picture, seemingly painted under the influence of Moré.' (Hardie 1995)

He expanded his repertoire, allowing for new influences and directions, continuing with rustic subjects but tackling larger scale work, murals and latterly moving strongly into watercolours. In the post-WWI poster art revival for the rejuvenation of the London Underground and railways, Clausen, along with Samuel John Lamorna BIRCH and Cayley ROBINSON, contributed designs and landscape art for advertising hoardings and other popular presentations. He became Master and Professor of Painting at the RA Schools.