Ed Gein was born in La Crosse County, Wisconsin, on August 27, 1906, the second of two boys of George Philip Gein (1873–1940) and Augusta Wilhelmine (née Lehrke) Gein (1878–1945). Gein had an older brother, Henry George Gein (1901–1944). Augusta despised her husband, an alcoholic who was unable to keep a job; he had worked at various times as a carpenter, tanner, and insurance salesman. George owned a local grocery shop for a few years, but sold the Business, and the family left the city to live in isolation on a 155-acre farm in the town of Plainfield in Waushara County, Wisconsin, which became the Gein family's permanent residence.

On April 1, 1940, Ed's father George died of heart failure caused by his alcoholism; he was 66 years old. Henry and Ed began doing odd jobs around town to help cover living expenses. The brothers were generally considered reliable and honest by residents of the community. While both worked as handymen, Ed also frequently babysat for neighbors. He enjoyed babysitting, seeming to relate more easily to children than adults. Henry began dating a divorced, single mother of two and planned on moving in with her; Henry worried about his brother's attachment to their mother and often spoke ill of her around Ed, who responded with shock and hurt.

On May 16, 1944, Henry and Ed were burning away marsh vegetation on the property; the fire got out of control, drawing the attention of the local fire department. By the end of the day – the fire having been extinguished and the firefighters gone – Ed reported his brother missing. With lanterns and flashlights, a search party searched for Henry, whose dead body was found lying face down. Apparently, he had been dead for some time, and it appeared that the cause of death was heart failure, since he had not been burned or injured otherwise. It was later reported, in Harold Schechter's biography of Gein, Deviant, that Henry had bruises on his head. The police dismissed the possibility of foul play and the county coroner later officially listed asphyxiation as the cause of death. The authorities accepted the accident theory, but no official investigation was conducted and an autopsy was not performed. Some suspected that Ed Gein killed his brother. Questioning Gein about the death of Bernice Worden in 1957, state investigator Joe Wilimovsky brought up questions about Henry's death. Dr. George W. Arndt, who studied the case, wrote that, in retrospect, it was "possible and likely" that Henry's death was "the "Cain and Abel" aspect of this case".

Gein and his mother were now alone. Augusta had a paralyzing stroke shortly after Henry's death, and Gein devoted himself to taking care of her. Sometime in 1945, Gein later recounted, he and his mother visited a man named Smith, who lived nearby, to purchase straw. According to Gein, Augusta witnessed Smith beating a dog. A woman inside the Smith home came outside and yelled to stop. Smith beat the dog to death. Augusta was extremely upset by this scene. What bothered her did not appear to be the brutality toward the dog but the presence of the woman. Augusta told Ed that the woman was not married to Smith so had no Business being there. "Smith's harlot", Augusta angrily called her. She had a second stroke soon after, and her health deteriorated rapidly. She died on December 29, 1945, at the age of 67. Ed was devastated by her death; in the words of author Harold Schechter, he had "lost his only friend and one true love. And he was absolutely alone in the world."

When questioned, Gein told investigators that between 1947 and 1952, he made as many as 40 nocturnal visits to three local graveyards to exhume recently buried bodies while he was in a "daze-like" state. On about 30 of those visits, he said he came out of the daze while in the cemetery, left the grave in good order, and returned home empty-handed. On the other occasions, he dug up the graves of recently buried middle-aged women he thought resembled his mother and took the bodies home, where he tanned their skins to make his paraphernalia.

At the time, the news reports of Gein's crimes spawned a subgenre of "black humor". Since the 1950s, Gein has frequently been exploited by transgressive art or "shock rock", often without association with his life or crimes beyond the shock value of his name. Examples of this include the song titled "Dead Skin Mask" (1990) from the Slayer album Seasons in the Abyss, "Nothing To Gein" (2001) from Mudvayne's album L.D. 50, and "Ed Gein" (1992) from The Ziggens' album Rusty Never Sleeps. There was the band Ed Gein called after the murderer. Ed Gein's atrocities were also satirized in Blind Melon's "Skinned" off the 1995 album Soup which juxtaposed cheery instrumentation with semi-factual representations of Gein's crimes, arguably toward a comedic end.

Gein was a handyman and received a farm subsidy from the federal government starting in 1951. He occasionally worked for the local municipal road crew and crop-threshing crews in the area. Sometime between 1946 and 1956, he also sold an 80-acre parcel of land that his brother Henry had owned.

Gein was also considered a suspect in several other unsolved cases in Wisconsin, including the 1953 disappearance of Evelyn Hartley, a La Crosse babysitter.

On November 21, 1957, Gein was arraigned on one count of first degree murder in Waushara County Court, where he pleaded not guilty by reason of insanity. Gein was diagnosed with schizophrenia and found mentally incompetent, thus unfit for trial. He was sent to the Central State Hospital for the Criminally Insane (now the Dodge Correctional Institution), a maximum-security facility in Waupun, Wisconsin, and later transferred to the Mendota State Hospital in Madison, Wisconsin.

Gein's house and property were scheduled to be auctioned March 30, 1958, amid rumors the house was to become a tourist attraction. On March 27, the house was destroyed by fire. Arson was suspected, but the cause was never officially determined. When Gein learned of the incident while in detention, he shrugged and said, "Just as well." Gein's car, which he used to haul the bodies of his victims, was sold at public auction for $760 to carnival sideshow operator Bunny Gibbons. Gibbons later charged carnival goers 25¢ admission to see it.

The story of Ed Gein has had a lasting effect on American popular culture as evidenced by its numerous appearances in film, music, and literature. The tale first came to widespread public attention in the fictionalized version presented by Robert Bloch in his 1959 suspense novel Psycho. In addition to Alfred Hitchcock's 1960 film of Bloch's novel, Psycho, Gein's story was loosely adapted into a number of films, including Deranged (1974), In the Light of the Moon (2000) (released in the U.S. and Australia as Ed Gein (2001)), Ed Gein: The Butcher of Plainfield (2007), Hitchcock (2012), and the Rob Zombie films House of 1000 Corpses and its sequel, The Devil's Rejects. Gein served as a model for several book and film characters, most notably such fictional serial killers as Norman Bates (Psycho), Leatherface (The Texas Chain Saw Massacre), Buffalo Bill (The Silence of the Lambs) and the character Dr. Oliver Thredson from the TV series American Horror Story: Asylum.

In 1968, doctors determined Gein was "mentally able to confer with counsel and participate in his defense". The trial began on November 7, 1968 and lasted one week. A Psychiatrist testified that Gein had told him that he did not know whether the killing of Bernice Worden was intentional or accidental. Gein had told him that while he examined a gun in Worden's store, the gun went off, killing Worden. Gein testified that after trying to load a bullet into the rifle, it discharged. He said he had not aimed the rifle at Worden, and did not remember anything else that happened that morning.

American filmmaker Errol Morris and German filmmaker Werner Herzog attempted unsuccessfully to collaborate on a film project about Gein from 1975 to 1976. Morris interviewed Gein several times and ended up spending almost a year in Plainfield interviewing dozens of locals. The pair planned secretly to exhume Gein's mother from her grave to test a theory but never followed through on the scheme and eventually ended their collaboration. The aborted project was described in a 1989 New Yorker profile of Morris.

Gein died at the Mendota Mental Health Institute due to respiratory failure secondary to lung cancer on July 26, 1984, at the age of 77. Over the years, souvenir seekers chipped pieces from his gravestone at the Plainfield Cemetery, until the stone itself was stolen in 2000. It was recovered in June 2001, near Seattle, and was placed in storage at the Waushara County Sheriff's Department. The gravesite itself is now unmarked, but not unknown; Gein is interred between his parents and brother in the cemetery.

At the request of the defense, Gein's trial was held without a jury, with Judge Robert H. Gollmar presiding. Gein was found guilty by Gollmar on November 14. A second trial dealt with Gein's sanity; after testimony by doctors for the prosecution and defense, Gollmar ruled Gein "not guilty by reason of insanity" and ordered him committed to Central State Hospital for the Criminally Insane. Gein spent the rest of his life in a mental hospital. Judge Gollmar wrote, "Due to prohibitive costs, Gein was tried for only one murder—that of Mrs. Worden. He also admitted to killing Mary Hogan."

The story of Ed Gein was featured on season one, episode one of the R-rated documentary series Behind The Screams first shown on 26 September 2015, called "A Real Psycho".