We investigated the structural, electrical and magnetic properties of Mn-doped $CuAlO_2$ delafossite ceramics ($CuAl_{1-x}Mn_{x}O_2,;0le;x;le0.05$), synthesized by solid-state reaction method in an air atmosphere at a sintering temperature of $1150^{circ}C$. The solubility limit of Mn ions in delafossite $CuAlO_2$ was found to be as low as about 3 $mol\%$. Positive Hall coefficient and the temperature dependence of conductivity established that non-doped $CuAlO_2$ ceramic is a variable-range hopping p-type semiconductor. It was found that the Mn-doping in $CuAlO_2$ rapidly reduced the hole concentration and conductivity, indicating compensation of free holes. The analysis of the magnetization data provided an evidence that antiferromagnetic superexchange interaction is the dominant mechanism of the exchange coupling between Mn ions in $CuAl_{1-x}Mn_{x}O$ alloy, leading to an almost paramagnetic behavior in this alloy.