The clip alarm (100) is a retaining clip attachable to personal items in order to function as a loss prevention device capable of emitting an audible and/or visual alarm in response to the clip and attached item being dislodged from a user's person. Upon dislodgment from a person or other support, a top clip member (105) of the device is pivoted towards an opposing, bottom clip member (110) through spring tensioning to make electrical contact with a battery (118) powering the alarm. The bottom surface of the bottom clip member (110) may have a permanently attached hook and loop fastener (200) to enable attachment of the clip to an item having a complementary hook and loop fastener. A recessed switch (120) is provided to turn the unit off when the user desires to intentionally remove it from his/her person or other object.