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Hutton was born in Edinburgh, the son of a merchant who became the city treasurer. He was educated at Edinburgh University, which he left in 1743 to be apprenticed to a lawyer. This did not retain his interest long for, in 1744, he returned to the university to read medicine. He studied in Paris for two years and finally gained his MD from Leiden in 1749. He next devoted several years to agriculture and industry, farming in Berwickshire and commercially producing sal ammoniac. In 1768 he returned to Edinburgh, financially independent, and devoted himself to scientific studies, especially of geology, for the rest of his life.

Hutton's uniformitarian theories were first published as a paper in 1788 and later extended into a two-volume work, Theory of the Earth (1795). This work proved difficult to read and it only reached a wide audience when his friend John Playfair edited and summarized it as Illustrations of the Huttonian Theory (1802). It marked a turning point in geology. The prevailing theory of the day, the neptunism of Abraham Werner, was that rocks had been laid down as mineral deposits in the oceans. However, Hutton maintained that water could not be the only answer for it was mainly erosive. The water could not account for the nonconformities caused by the foldings and intrusions characteristic of the Earth's strata. Hutton showed that the geological processes that had formed the Earth's features could be observed continuing at the present day. The heat of the Earth was the productive power, according to Hutton, that caused sedimentary rocks to fuse into the granites and flints, which could be produced in no other way. It could also produce the upheaval of strata, their folding and twisting, and the creation of mountains.

A long time scale is essential to Hutton's theory of uniformitarianism as the forces of erosion and combustion work, in general, only slowly, as demonstrated by the presence of visible Roman roads. He concluded that on the face of the Earth “we find no vestige of a beginning – no prospect of an end.”

Hutton's work was accepted with little delay by most geologists, including the leading Edinburgh neptunist, Robert Jameson. In the 19th century Charles Lyell expanded the theories of uniformitarianism and these were to influence Charles Darwin in his theory of evolution.