Stein was born in Washington, D.C., the son of Mildred (née Fishman), a homemaker, and Herbert Stein, a Writer, Economist, and presidential adviser. He is Jewish and grew up in the Woodside Forest neighborhood of Silver Spring, Maryland. Stein graduated from Montgomery Blair High School in 1962 along with classmate Journalist Carl Bernstein (class of 1960); Actress Goldie Hawn (class of 1963) was one year behind. Actor Sylvester Stallone was a schoolmate at Montgomery Hills Junior High School. He went on to major in economics at Columbia University's Columbia College, where he was a member of Alpha Delta Phi and the Philolexian Society. After graduating with honors from Columbia in 1966, Stein went to Yale Law School, graduating as valedictorian in June 1970.

Stein is married to entertainment Lawyer Alexandra Denman, who is from Arkansas. They were married in 1968, but later divorced in 1974. Eventually, they got back together, and in 1977, they were married again. They have one son, Tom, born in 1987. Stein lives with Denman in Beverly Hills and Malibu, California. He also has a summer home in Sandpoint, Idaho. Stein also owns an apartment in the Watergate complex in Washington, D.C., which he inherited from his parents.

Stein began his political career as a speechwriter and Lawyer for President Richard Nixon, and later for President Gerald Ford. On May 3, 1976, Time magazine speculated on the possibility of Stein having actually been Deep Throat. Stein responded over the years by not only denying he was Deep Throat, but by going further and accusing Journalist Bob Woodward of falsifying the famous secret source. In the May 14–21, 1998 edition of the Philadelphia City Paper, Stein is quoted saying, "Oh, I don't think there was a Deep Throat. That was a fake. I think there were several different sources and some they just made up." After Mark Felt's identity as Deep Throat was revealed, Stein stated that Richard Nixon would have prevented the rise to power of the Khmer Rouge if he had not been forced to resign. For his actions leading to that resignation, Stein said:

Stein became a Hollywood consultant before he moved into acting. His film career was launched by his performance as the monotonous economics Teacher in the 1986 movie Ferris Bueller's Day Off. In one scene, he gives an unscripted economics lecture, relying on his own experience in economics. The topics covered in his lecture are the Smoot-Hawley Tariff of 1930 and the then-current debate over supply-side economics.

He also appeared in several television advertisements, most notably for the product "Clear Eyes" throughout the 1990s and 2000s ("The difference is clear ... Clear Eyes." "Clear Eyes, wow!"). Many advertisements spoof movies of the day, such as one where Stein is a Painter (a play on The Da Vinci Code). Before this, he appeared for Godfather's Pizza in 1987 and as a bland science Teacher in 1990 for Sprinkled Chips Ahoy! cookies. In 2013, Stein began appearing in advertisements for small Business accounting Service firm 1800Accountant.

In addition, Stein's voice roles include The Pixies, magical creatures on the animated series The Fairly OddParents; Mr. Purutu on the animated series The Emperor's New School; Professor Wisenstein in Bruno the Kid; the birthday party clown, Mr. Giggles, on The Adventures of Jimmy Neutron: Boy Genius; a bingo caller on Rugrats; and Pip on Animaniacs. Futterman in Freakazoid. Stein also voiced a Psychiatrist, again named after himself, in the USA TV series Duckman; he once appeared in the sitcom Married... with Children as a receptionist in the animal afterlife. He also made a cameo appearance in the comic book Young Justice, as Ali Ben Styn. Another cameo appearance was as Rabbi Goldberg in the Family Guy episodes "When You Wish Upon a Weinstein" and "Family Goy". Stein also voiced the character Sam Schmaltz in the 1996 computer adventure game Toonstruck.

In 1997, Stein was given his own game show by Comedy Central, titled Win Ben Stein's Money, along with co-host Jimmy Kimmel (replaced by Nancy Pimental and later by Sal Iacono). True to its name, the money that contestants won on the show was subtracted from the $5,000 pay that Stein earned per episode (in addition to his salary). The show won five Daytime Emmy Awards before ending its run in 2003.

In 1999, during the height of Win Ben Stein's Money's popularity, Comedy Central gave Stein another show, a talk show with Celebrity guests entitled Turn Ben Stein On. One of the mainstays of the show was Stein's dog, Puppy Wuppy, who had free run of the set. In 2001, Stein appeared on a Celebrity episode of The Weakest Link entitled "TV Hosts Edition" alongside other television hosts where he got voted off in round 6.

Stein is an opponent of the legalization of abortion and was given a Pro-Life Award in 2003 by the National Right to Life Educational Trust Fund.

In 2005, Stein said in the American Spectator:

On May 14, 2006, during an appearance on the Fox News program Your World with Neil Cavuto, Stein called for a tax increase of 3.5% for wealthy Americans, to be earmarked for Soldiers and military initiatives. Stein wrote an editorial for The New York Times critical of those who would rather make money in the world of Finance than fight terrorism.

In 2007, Stein chastised the police and the GOP leadership for their response to the Larry Craig scandal. Stein said that Craig's sexuality should not be an issue: "A party that believes in individual rights should be rallying to his defense, not making him walk the plank."

Stein endorsed John McCain for US President in 2008, calling him an "impressive guy". That year, he also stated that he would vote for Ralph Nader for President. In January 2012, Stein appeared in political advertisements sponsored by Associated Industries of Florida supporting legislation that would create three resort casinos in South Florida. He claimed in late 2014 that President Barack Obama was the most racist President in American history, saying Obama "made everything about race".

Stein is a staunch supporter of Israel. On Larry King Live in 2009, in a heated exchange with then-Congressman Ron Paul, he has referred to Paul as anti-semitic for referring to the U.S. as "occupiers."

Stein has criticized the United States Internal Revenue Code for being too lenient on the wealthy. He has repeated the observation made by Warren Buffett, one of the richest individuals in the world (who pays mostly capital gains tax), that Buffett pays a lower overall tax rate than his Secretaries (who pay income taxes and payroll taxes). Stein has advocated increasing taxation on the wealthy. Stein objected to Obama's proposal in 2010 to not extend tax cuts for the highest earning taxpayers in the midst of the recession, saying that

When the head of the International Monetary Fund, Dominique Strauss-Kahn, was arrested for sexual assault and attempted rape in 2011, Stein published an editorial in The American Spectator in which he closely scrutinized Strauss-Kahn's accuser and cited Strauss-Kahn's education, wealth, and position as reasons to believe he was unlikely to have committed the crime.

In 2012, Stein stated that due to the tremendous amount of national debt, he agreed with Obama's proposal to increase taxes on the wealthy and that ultimately everyone's taxes should be raised to avoid defaulting on the debt.

Stein initially supported Donald Trump in the 2016 U.S. presidential election, but retracted his support in October 2016, writing, "But it's time for Donald Trump to go back to Trump Tower. Time for Mike Pence to move to the top of the ticket." However, Ben Stein went on to vote for Donald Trump.

Stein has denounced the scientific theory of evolution, which he and other intelligent design advocates call "Darwinism", declaring it to be "a painful, bloody chapter in the history of ideologies", "the most compelling argument yet for Imperialism", and the inspiration for the Holocaust. Stein does not say belief in evolution alone leads to genocide, but that scientific materialism is a necessary component. He co-wrote and stars in Expelled: No Intelligence Allowed, a film that aims to persuade viewers that evolution was instrumental to the rise of the eugenics movement, Nazi Germany, and the Holocaust, and portrays advocates of intelligent design as victims of intellectual discrimination by the scientific community, which has rejected intelligent design as creationist pseudoscience. In the trailer for the film, Stein said that his aim was to expose "people out there who want to keep science in a little box where it can’t possibly touch God."