Mason was born near Leesburg in Loudoun County, Virginia, into a politically powerful family. His great-grandfather, Thomson Mason (1730 - 1785) was chief justice of the Virginia supreme court and brother of George Mason (1725-1792), who took part in the Constitutional Convention. His grandfather, Stevens Thomson Mason, was a U.S. Senator from Virginia. His uncle, Armistead Thomson Mason (1787 - 1819), was also a U.S. Senator from Virginia. His uncles by marriage, Benjamin Howard (1760 - 1814) and William Taylor Barry (1784 - 1835), were both in the Kentucky house of representatives and were U.S. Representatives from Kentucky. Howard was Governor of Louisiana (Missouri) Territory, 1810-12, and Governor of Missouri Territory, 1812-13. Barry served as U.S. Senator from Kentucky, 1814-16, and then had a long career in a number of Kentucky government positions, and ultimately became Postmaster General, 1829-35. In 1812, Mason’s father, John Thomson Mason (1787–1850), left the Mason family stronghold in Virginia to attempt to make his own fortune in Lexington, Kentucky. However, his father’s business ventures were a complete failure and the family became nearly broke in the 1820s.

His father was appointed Secretary of Michigan Territory in 1830 by President Andrew Jackson. Young Stevens was more politically savvy than his father and helped to protect him from schemes launched by anti-Jackson forces. This gained him notice from the Territorial Governor, Lewis Cass. In 1831, President Jackson sent his father on a mission to Mexico and named Stevens to replace his father as Secretary, at the age of nineteen before he could even vote. At about the same time, Governor Cass became Jackson’s Secretary of War. George Bryan Porter was named to replace him, but he was frequently absent and Mason was for all practical purposes the acting governor during this time, leading to his nickname of the "Boy Governor."

Mason was influential in petitioning for Michigan statehood. When the first petition in 1832 was not acted upon, Mason commissioned a territorial census. When the census was completed in 1834, it determined that 86,000 people lived in the lower peninsula, more than the 60,000 required for statehood by the Northwest Ordinance of 1787. A dispute over a strip of land, the Toledo Strip, claimed by both Michigan and Ohio led to the Toledo War. President Jackson appointed Benjamin Chew Howard of Baltimore, and Richard Rush of Philadelphia to serve on a commission to arbitrate the dispute but could not persuade Mason to back down. Not wanting to alienate political support in Ohio, President Jackson removed Mason from office in 1835 and appointed John S. (“Little Jack”) Horner as his replacement. Although replaced by Horner, Mason was still popular in Michigan. Voters approved a constitution in October 1835 and elected Mason as Governor. However, the U.S. Congress refused to recognize Michigan as a state until the dispute with Ohio was resolved.

In 1836, facing financial difficulties due to Michigan not being recognized as a state, Mason agreed to a compromise reached by the U.S. Congress and agreed to cede the disputed land to Ohio in exchange for the western two-thirds of the Upper Peninsula. A convention in September, 1836 refused to go along with Mason, but Mason finally prevailed in a second convention in December, 1836. On January 26, 1837, Michigan was admitted to the Union.

In 1835 Mason had initiated an ambitious internal improvement program, which included development of three railroads and two canals (one of which was the Clinton-Kalamazoo Canal). Mason was re-elected in 1837, but the state’s economy soon began to suffer from the effects of the Panic of 1837. Earlier in 1837, Mason had negotiated to fund the internal improvement program through the sale of $5,000,000 in bonds. This arrangement fell apart in 1837 and following bankruptcies by both the company building the canal and the bank backing the loans, the state was left with over $2,000,000 in bad debt. During his business trips to New York to finance his internal improvement program, Mason had met Julia Phelps. He married her on November 1, 1838.

Rather than risking a contentious campaign and the possibility of an embarrassing defeat in the elections of 1839, Mason instead decided to give up politics and attempt a private law practice. His successor as governor, an old political rival, William Woodbridge, was determined to place the blame for Michigan’s financial mess on Mason, and charged Mason with corruption related to the $5,000,000 loan. Mason attempted to defend himself, but his reputation was ruined.

In 1841, Mason left Michigan for New York City, where his wealthy father-in-law, Thaddeus Phelps lived. Mason tried to establish a law practice there, but struggled to build a clientele. He caught pneumonia in the winter of 1842 and died at the age of thirty-one during the night of January 4, 1843 (he is sometimes listed as dying on January 5).

Mason was initially interred at New York Marble Cemetery, but on June 4, 1905, his remains were brought from New York to Detroit, accompanied by his sister Emily Mason, then age 92; his daughter, Mrs. Dorothy Mason Wright; three grandsons; and several grand-nephews and great-grandchildren. Services were conducted by Rev. David M. Cooper, who had known Mason as Governor, 70 years earlier. Other notable attendees included then Governor, Fred M. Warner, and the mayor of Detroit, George P. Codd. His remains were interred at Capitol Park, the site of the old Michigan Capitol. Later, a bronze monument was erected over the grave.

Among his other accomplishments, Mason created an educational system and located the University of Michigan in Ann Arbor.