Screenwriters Charlie Wachtel and David Rabinowitz discovered Ron Stallworth's memoir Black Klansman in July 2015, interviewed him, and wrote a spec script before pitching it to producers Shaun Redick and Ray Mansfield.

The project was brought to QC Entertainment, which had co-produced Get Out, and that company again teamed up with Jason Blum's Blumhouse Productions and Jordan Peele's Monkeypaw Productions to produce the film.

Spike Lee signed on as director in September 2017, with John David Washington in negotiations to star, and Adam Driver, Laura Harrier, Topher Grace and Corey Hawkins joining the cast the following month.

The film features Harry Belafonte's final on-screen performance before his death in April 2023, playing an activist recounting the lynching of Jesse Washington.

Filming began in October 2017 in New York State, including locations in Ossining and the Rockland County hamlet of Garnerville, where exterior shots of a Colorado Springs police station were filmed.

According to Spike Lee, he asked his entire crew to dress in suits and dresses on the day they filmed Harry Belafonte's scene, as a sign of respect for the actor.

The film closes with real footage from the 2017 Unite the Right rally in Charlottesville, the car attack that killed counter-protester Heather Heyer, and comments by David Duke and President Donald Trump, ending with a dedication to Heyer.

The film's U.S. theatrical release date, August 10, 2018, was deliberately chosen to coincide with the one-year anniversary of the Charlottesville rally.

Filmmaker Boots Riley publicly criticized the film for allegedly glossing over Stallworth's real-life work for COINTELPRO against Black radical organizations and for fictionalizing a bombing to portray police more heroically, prompting a response from Spike Lee.

Although the film is based on true events, it fictionalizes several elements: the character Patrice is entirely invented, no actual bombing took place despite real conversations about one, and Stallworth never personally revealed his identity to the Klan, with David Duke only learning he was Black through a 2006 exposé.