From the age of two Haden sang with his family's country music band on midwestern radio and television programs. He moved to Los Angeles and began to play jazz with Art Pepper and others. While working (1957–59) in pianist Paul Bley's group, Haden began playing free jazz with saxophonist Ornette Coleman (Coleman, Ornette), accompanying with lines derived from Coleman's phrasing. Haden was a member of the quartet that recorded Coleman's early classic albums (The Shape of Jazz to Come and Change of the Century) and that created a sensation in New York City beginning in 1959.

Though Haden left Coleman in late 1960, they performed together intermittently for several decades thereafter. Haden also worked with other leaders, most often in Keith Jarrett (Jarrett, Keith)'s 1967–75 trio and quartet. In 1969 he formed his Liberation Music Orchestra, which included bop-oriented as well as free jazz players; he re-formed the orchestra in 1982 and 1990. The group played Carla Bley's original adaptations of themes from the Spanish Civil War and Latin-American resistance movements, as well as original works (such as Haden's “Song For Che”).

In 1976, with three other ex-Coleman sidemen, Haden formed Old and New Dreams to play, for the most part, Coleman songs. Influenced by bop bassist Wilbur Ware, Haden developed a seemingly simple style centred on swinging rhythms and pungent rhythmic variations, a large, perfectly centred tone, a talent for melodic soloing, and an acute harmonic sensitivity. In the late 1980s and 1990s, he led his own bop-oriented Quartet West.