A Highland army marches to Harlaw (to claim an earldom for their leader). The local forces oppose them on principle, and a local chief kills the Highland commander. The battle is long and bloody, but the defenders hold their ground
Most ballad books discussing Harlaw mention only the immediate cause: The conflict over the Earldom of Ross. This was real enough: The earldom had passed to a woman, Euphemia Ross, who in 1382 had married Alexander the "Wolf of Badenoch," a younger son of Robert II. (For this see, e.g., Stephen Boardman, _The Early Stewart Kings_, pp. 77-79). But this was Ross's second marriage. She had had a daughter Mary by her first marriage, and Mary had married Donald of the Isles. In any case, the marriage to Alexander had ended in divorce (Boardman, pp. 179-180).
The exact date of Euphemia Ross's death is unknown, but it was probably around 1395. Alexander of Badenoch died in 1406. Donald of the Isles, as husband of Mary Ross, was the obvious heir -- and he set out to make good that claim. Hence the events resulting in the Battle of Harlaw.
But the conflict was in fact much more important than a conflict over an earldom. Since the death of Robert Bruce, Scotland's central government had been weak even by Scottish standards: David Bruce had spent much of his reign in English hands, his successor Robert II the Steward was a tired old man, Robert III was crippled and had limited ability to rule, and the King at the time of Harlaw was James I, who was still only a teenager and in English custody as well. The country, since the time of Robert III, had been ruled by Robert Duke of Albany, the younger brother of Robert III (they shared the name Robert because Robert III was born John but took a different throne name; he thought "John" unlucky).
Albany was energetic, but not particularly efficient; Scotland degenerated into a collection of quarreling baronies. The Highlands were almost completely beyond central control. The Lords of the Isles were in effect independent kings, and they had great influence in the western Highlands. Given control of Ross, in the central Highlands, and Scotland would likely have split into two nations. Harlaw allowed the government to retain just enough control to prevent that.
This ballad is generally regarded as historically unreliable, on several counts -- a charge dating back to Child. David Buchan, however, takes a different view (see "History and Harlaw," printed in E. B. Lyle, ed., _Ballad Studies_).
The first objection to the song lies in the prominence of the Forbeses in a battle directed by the Earl of Mar. Buchan, however, alludes to Dr. Douglas Simpson's book _The Earldom of Mar_, which attempts to reconstruct this battle.
According to this view, the citizens of Aberdeenshire were concerned about the invasion by Highlandmen, and sought to block it. But they could not know which route MacDonald would take to the city -- via Harlaw or Rhynie Gap, several hours' march apart. Simpson argues that Mar garrisoned Harlaw and assigned the Forbeses, strong vassals situated in the area, to guard Rhynie.
When the Highlandmen arrived at Harlaw, Mar sent for the Forbes. They arrived on the scene, defeated the nearest Highland forces, and partly retrieved the battle. The ballad then makes sense if seen as a description from the Forbes standpoint.
The second objection, to the presence of Redcoats, Buchan meets by assuming the song has been confused with an account of the Jacobite rebellions. This strikes me as less convincing.
The third argument that the song is recent comes from the similarity of versions. Buchan argues that this could have been caused by broadsheets distributed by Alexander Laing, who printed the earliest (B) fragment known to Child. This is possible though by no means sure (no such broadsheet, to my knowledge, has been found) -- but in any case the objection is weak, because Bronson's #15, at least, represents a text well removed from the common stream. Most texts of "Harlaw" are from Aberdeenshire; they could be close together simply because many singers knew the song and could compare their texts.
Ord reports a claim that the chorus is derived from a druidic chant. Uh-huh. - RBW