McDonald was appointed caretaker manager of Stirling Albion after Jocky Scott left the club in December 2011.[5][6] He became the youngest manager of a senior league club in the UK when he was appointed Stirling Albion manager on a permanent basis on 22 January 2012.[7] McDonald missed a league victory against Rangers in October 2012 as he was getting married on the same day.[8] He led the Binos to promotion to Scottish League One via the play-offs the following season by beating his former club East Fife in the final of that playoffs that year, but left the club in October 2014 with them sitting bottom of League One.
On 8 December 2021, McDonald joined East Fife as assistant manager. McDonald became their manager on 25 October 2022,[9] but he resigned in February 2024 and was replaced by Dick Campbell.[10][11]
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