One of five children born to a New York City postal worker, Lancaster exhibited considerable athletic prowess as a youth. At age 19 he joined the circus and performed in an acrobatic act with partner Nick Cravat, a lifelong friend who would go on to costar in several of Lancaster's films. Lancaster served in the army during World War II and became interested in acting as a result of performing in USO (United Service Organizations, Inc.) shows. Following the war, he landed his first professional acting job in the Broadway play A Sound of Hunting (1945). The play was short-lived, but Lancaster's performance was noticed by a talent scout who took the actor to Hollywood. Lancaster's debut film, Desert Fury (1947), was delayed in its release; he first came to the attention of audiences in the film noir classic The Killers (1946). With this film, Lancaster established a duality to his screen persona: he was the rugged he-man of his publicized image but also a capable actor with a penchant for offbeat roles.

Lancaster won an Academy Award for one of his most powerful and charismatic performances, that of a charlatan evangelist in Elmer Gantry (1960). He was memorable in a supporting role as a Nazi war criminal in Judgment at Nuremburg (1961), and received another Oscar nomination for his sensitive portrayal of Robert Stroud (Stroud, Robert)—a prison inmate who became one of the world's leading ornithologists—in director John Frankenheimer's Birdman of Alcatraz (1962). Lancaster's other standout films from the 1960s include Luchino Visconti (Visconti, Luchino)'s Il gattopardo (1963; The Leopard); two more films for Frankenheimer, Seven Days in May (1964) and The Train (1965); The Professionals (1966); and the cult favourite The Swimmer (1968).

Although his first film of the 1970s was the blockbuster disaster epic Airport (1970), Lancaster appeared in few films of note during that decade. His supporting performance in Bernardo Bertolucci's 1900 (1976) was well-received, but not until 1980 did Lancaster revive his career with an Oscar-nominated performance as an aging, small-time bookie in director Louis Malle (Malle, Louis)'s Atlantic City. Other memorable character roles followed, including a turn as a dreamy, star-gazing Texas oil billionaire in the comedy Local Hero (1983), an enjoyable reunion with Kirk Douglas in Tough Guys (1986), and his moving portrayal of an aging doctor who still regrets his missed opportunity in professional baseball in the immensely popular Field of Dreams (1989). Lancaster gave his final performance in the acclaimed TV miniseries Separate but Equal (1991), after which health problems forced his retirement.