Built around 1640 by the Nesbitt family, who had ventured from Scotland to establish themselves in County Leitrim, the castle stood roughly 40 metres from the lakeshore where the River Shannon flows. Its strategic position would have offered sweeping views across the water, though today nothing remains visible above ground in what is now peaceful pasture land.

The castle met its likely demise during the Confederate Wars, when it was captured and probably burnt, marking the end of its brief existence as a fortified residence. The Nesbitts appear to have abandoned the site after this destruction, relocating about three kilometres northwest to Derrycarne on the River Shannon, where they remained until the family line ended in 1854 when the last Nesbitt died without heirs. This move suggests the damage at Aughry was too extensive to warrant rebuilding, or perhaps the memories of conflict made the location less appealing.

When the antiquarian Francis Grose sketched the ruins around 1820, he documented two separate standing walls, likely the gables of what had been a two storey house with an attic space. Each wall featured a substantial chimney stack, whilst one displayed a distinctive corner turret supported on corbels; a architectural flourish typical of Scottish castle design that the Nesbitts had brought with them from their homeland. These atmospheric ruins have since been cleared away entirely, leaving only historical records and archaeological surveys to tell the story of this short lived Scottish outpost on the shores of an Irish lough.