Unlike David I, Alexander III did not become a legend in his own lifetime. He first became a paragon of princely power and his reign a 'golden age', it has been pointed out, almost a century after his death in the chronicle of John of Fordun, written in the 1380s. By the 1440s, the age of Walter Bower's Scodchronicon, the prose had become more purple and patriotic: Alexander III had become an ideal king and his reign a lost golden age. The truth is probably more modest: the reign was a period of relative peace and of moderate but growing prosperity. Overseas exports were increasing although they remained narrowly based in wool and hides. Existing burghs were expanding their economies, though they still remained very modest in size. The amount of coin in circulation was steadily growing in the second half of the century, but there was no dramatic increase of the money supply. The hallmarks of the reign were stability and consensus rather than a dramatic new order or prosperity.

The most significant development in the reign had been the completion of his father's expedition to the Isles. It was in the 1260s that the Hebrides were finally incorporated into the kingdom. To many Scots and to most historians of Scotland, this has had an aura of both inevitability and justice about it. The battle of Largs (1263), when Hakon IV was repulsed by the forces of Alexander III, has almost the status of a Stirling Bridge or Bannockburn in Scottish history, still annually reenacted to impress itself on the Ayrshire consciousness, if not the national. Yet there can be little doubt that the King of Scots and his agents were the aggressors, both before and after Largs. In Hakon's Saga, Alexander II is portrayed as a king who died because he attacked the sacred territory of Columba. In 1262 the Earl of Ross laid waste to part of Skye and it was against a background of atrocity stories of the burning of churches and slaughter of women and children that Hakon assembled his fleet in mid-1263. The scale of the battle itself is a matter of considerable dispute. There can be no doubt that Hakon's force was repulsed, but the likelihood that only a fraction of his 120-strong fleet of ships was involved made the outcome of the battle less conclusive than many accounts portray it.