The 1920–21 season was the 23rd in the history of the Southern League. League was split into two sections, one for English clubs and one for Welsh clubs. The previous season had seen all Division One clubs elected to the Football League to form the new Third Division, leaving ten of the eleven clubs from Division Two (Caerphilly, who had finished bottom of Division Two, had resigned from the league) as the sole remaining members, all of which were from Wales. As a result, the league admitted thirteen new clubs from England (nine of which were reserve teams) and one from Wales (Aberdare Athletic).