R.B. Bennett was born on July 3, 1870, when his mother, Henrietta Stiles, was visiting at her parents' home in Hopewell Hill, New Brunswick, Canada. He grew up nearby at the home of his father, Henry John Bennett, at Hopewell Cape, the shire town of Albert County, then a town of 1,800 people. His father was descended from English ancestors who had emigrated to Connecticut in the 18th century. His great, great grandfather Bennett migrated from Connecticut to Nova Scotia c. 1765, before the American Revolution, taking advantage of lands vacated by the Acadians during the Great Upheaval. R.B. Bennett's family was poor, subsisting mainly on the produce of a small farm. His early days inculcated a lifelong habit of thrift. The driving force in his family was his mother. She was a Wesleyan Methodist and passed this faith and the Protestant ethic on to her son. His principle ever after was: work as hard as you can, earn all you can, save all you can, and then give all you can. Bennett's father does not appear to have been a good provider for his family, though the reason is unclear. He operated a general store for a while and tried to develop some gypsum deposits. The Bennetts had previously been a relatively prosperous family, operating a shipyard in Hopewell Cape, but the change to steam-powered vessels in the mid-1800s meant the gradual winding down of their business. However, the household was a literate one, subscribing to three newspapers. They were strong Conservatives; indeed one of the largest and last ships launched by the Bennett shipyard (in 1869) was the Sir John A. Macdonald. Educated in the local school, Bennett was a good student, but something of a loner. In addition to his Protestant faith, Bennett grew up with an abiding love of the British Empire, then at its apogee.

By the age of 15, Bennett had learned all that the local school could teach him, and he enrolled in the New Brunswick Department of Education's teacher training school in Fredericton, getting his second class teaching certificate. He then taught the elementary grades at a small village called Irishtown, just north of Moncton, New Brunswick. He campaigned vigorously in the Conservative interest in the 1887 federal election, at 17 years of age taking the floor at public meetings in rural areas, well able to handle hecklers. He earned the gratitude of the local candidate, Dr. R.C. Weldon, a co-founder of the Dalhousie Law School.

In 1888 Bennett obtained his first-class teaching certificate, and received an appointment as principal of the 159-student Douglastown school. Though only 18 years old, Bennett was a success. He was 6' tall and his serious demeanour enabled him to control his pupils. Sundays were spent across the Miramichi River in the larger community of Chatham, New Brunswick, where he attended the Methodist Church twice and taught Sunday School. He also joined the Chatham branch of the Conservative Party, and spoke whenever he could. He became a polished speaker. During this time he formed several female friendships, but none blossomed into marriage. One day, while Bennett was crossing the Miramichi on the ferry boat, a well-dressed lad about nine years younger came over to him and struck up a conversation. This was the beginning of an improbable but important friendship with Max Aitken, later the industrialist and British press baron, Lord Beaverbrook. The agnostic Aitken liked to tease the Methodist Bennett, whose fiery temper contrasted with Aitken's ability to turn away wrath with a joke. This friendship would become important to his success later in life, as would his friendship with the Chatham lawyer, Lemuel J. Tweedie, a prominent Conservative politician. He began to study law with Tweedie on weekends and during summer holidays. Another important friendship was with the prominent Shirreff family of Chatham, the father being High Sheriff of Northumberland County for 25 years. The son, Harry, joined the E.B. Eddy Company, a large pulp and paper industrial concern, and was transferred to Halifax. His sister moved there to study nursing, and soon Bennett joined them to study law at Dalhousie University. Their friendship was renewed there, and became crucial to his later life when Jennie Shirreff married the head of the Eddy Company. She later made Bennett the lawyer for her extensive interests.

Bennett started at Dalhousie University in 1890, graduating in 1893 with a law degree. He worked his way through with a job as assistant in the library, being recommended by Dr. R.C. Weldon. He was then a partner in the Chatham law firm of Tweedie and Bennett. Max Aitken (later known as Lord Beaverbrook) was his office boy, while articling as a lawyer, acting as a stringer for the Montreal Gazette, and selling life insurance. Aitken persuaded him to run for alderman in the first Town Council of Chatham, and managed his campaign. Bennett was elected by one vote, and was later furious with Aitken when he heard all the promises he had made on Bennett's behalf. Despite his election to the Chatham town council, Bennett's days in the town were numbered. He was ambitious and saw that the small community was too narrow a field for him. He was already negotiating with Sir James Lougheed to move to Calgary and become his law partner. Lougheed was Calgary's richest man and most successful lawyer.

Bennett moved to Alberta in 1897. A lifelong bachelor and teetotaler (although Bennett was known by select associates to occasionally drink alcohol when the press was not around to observe this), he led a rather lonely life in a hotel and later, in a boarding house. For a while a younger brother roomed with him. He ate his noon meal on workdays at the Alberta Hotel. Social life, such as it was, centered on church. There was, however, no scandal attached to his personal life. Bennett worked hard and gradually built up his legal practice. He was elected to the Legislative Assembly of the Northwest Territories in the 1898 general election, representing the riding of West Calgary. He was re-elected to a second term in office in 1902 as an Independent from the parties in the Northwest Territories legislature. In 1905, when Alberta was carved out of the territories and made a province, Bennett became the first leader of the Alberta Conservative Party. In 1909, he won a seat in the provincial legislature, before switching to federal politics. Elected to the Canadian House of Commons in 1911, Bennett returned to the provincial scene to again lead the Alberta Tories in the 1913 provincial election, but kept his federal seat in Ottawa when his Tories failed to take power in the province; such practice was later forbidden.

At age 44, he tried to enlist in the Canadian military once World War I broke out, but was turned down as being medically unfit. In 1916, Bennett was appointed director general of the National Service Board, which was in charge of identifying the number of potential recruits in the country.

While Bennett supported the Conservatives, he opposed Prime Minister Robert Borden's proposal for a Union Government that would include both Conservatives and Liberals, fearing that this would ultimately hurt the Conservative Party. While he campaigned for Conservative candidates in the 1917 federal election he did not stand for re-election himself. Nevertheless, Borden's successor, Arthur Meighen appointed Bennett Minister of Justice in his government, as it headed into the 1921 federal election in which both the government and Bennett were defeated. Bennett won the seat of Calgary West in the 1925 federal election and was returned to government as Minister of Finance in Meighen's short-lived government in 1926. The government was defeated in the 1926 federal election. Meighen stepped down as Tory leader, and Bennett became the party's leader in 1927 at the first Conservative leadership convention.

As Opposition leader, Bennett faced off against the more experienced Liberal Prime Minister William Lyon Mackenzie King in Commons debates, and took some time to acquire enough experience to hold his own with King. In 1930, King blundered badly when he made overly partisan statements in response to criticism over King's handling of the economic downturn, which was hitting Canada very hard. King's worst error was in stating that he "would not give Tory provincial governments a five-cent piece!" This serious mistake, which drew wide press coverage, gave Bennett his needed opening to attack King, which he did successfully in the election campaign which followed. By defeating William Lyon Mackenzie King in the 1930 federal election, he had the misfortune of taking office during the Great Depression. Bennett tried to combat the depression by increasing trade within the British Empire and imposing tariffs for imports from outside the Empire, promising that his measures would blast Canadian exports into world markets. His success was limited however, and his own wealth (often openly displayed) and impersonal style alienated many struggling Canadians. When his Imperial Preference policy failed to generate the desired result, Bennett's government had no real contingency plan. The party's pro-business and pro-banking inclinations provided little relief to the millions of increasingly desperate and agitated unemployed. Despite the economic crisis, Laissez-faire persisted as the guiding economic principle of Conservative Party ideology. Government relief to the unemployed was considered a disincentive to individual initiative, and was therefore only granted in the most minimal amounts and attached to work programs. An additional concern of the federal government was that large numbers of disaffected unemployed men concentrating in urban centres created a volatile situation. As an "alternative to bloodshed on the streets," the stop-gap solution for unemployment chosen by the Bennett government was to establish military-run and -styled relief camps in remote areas throughout the country, where single unemployed men toiled for twenty cents a day. Any relief beyond this was left to provincial and municipal governments, many of which were either insolvent or on the brink of bankruptcy, and which railed against the inaction of other levels of government. Partisan differences began to sharpen on the question of government intervention in the economy, since lower levels of government were largely in Liberal hands, and protest movements were beginning to send their own parties into the political mainstream, notably the Cooperative Commonwealth Federation and William Aberhart's Social Credit Party in Alberta.

Bennett hosted the 1932 Imperial Economic Conference in Ottawa; this was the first time Canada had hosted the meetings. It was attended by the leaders of the independent dominions of the British Empire (which later became the Commonwealth of Nations). Bennett dominated the meetings, which were ultimately unproductive, due to the inability of leaders to agree on policies, mainly to combat the economic woes dominating the world at the time. A nickname that would stick with Bennett for the remainder of his political career, "Iron Heel Bennett," came from a 1932 speech he gave in Toronto that ironically, if unintentionally, alluded to Jack London's socialist novel:

What do they offer you in exchange for the present order? Socialism, Communism, dictatorship. They are sowing the seeds of unrest everywhere. Right in this city such propaganda is being carried on and in the little out of the way places as well. And we know that throughout Canada this propaganda is being put forward by organizations from foreign lands that seek to destroy our institutions. And we ask that every man and woman put the iron heel of ruthlessness against a thing of that kind.