Ferguson was born at Growell, near Dromore, County Down and was the son of a farmer.

In 1902 Ferguson went to work with his brother Joe in his bicycle and car repair business. Whilst working there as a mechanic, he developed an interest in aviation, to the extent of visiting airshows abroad. In 1904, he began to race motorcycles.

In 1909 Ferguson became the first person to fly in Ireland, when he took off on 31 December in a monoplane he had designed and built himself. After falling out with his brother over the safety and future of aviation Ferguson decided to go it alone, and in 1911 founded a company selling Maxwell, Star and Vauxhall cars and Overtime Tractors — eventually to be named Harry Ferguson Limited.

Ferguson saw at first hand the weakness of having tractor and plough as separate articulated units, and in 1917 he devised a plough which could be rigidly attached to a Model T Ford car - the Eros, which became a limited success, competing with the Model F Fordson.

Ferguson eventually founded the Ferguson-Sherman Inc., along with Eber and George Sherman. The new enterprise developed a ploughing system that incorporated a Duplex hitch system which fitted the Fordson line tractors. Ferguson's new hydraulic system was first seen on the Ferguson - Brown Model A tractors. Ferguson eventually made a handshake agreement with Henry Ford so that Ford could use Ferguson's three-point hitch system on his new line of tractors (9N, 2N, and 8N). Henry Ford II, Ford's grandson, abruptly ended the handshake deal on 30 June 1947. Ferguson's reaction was a law suit demanding $251,000,000 in all. The disagreement was settled by Ferguson in April 1952. A year later Ferguson merged with Massey Harris to become Massey - Harris - Ferguson Co. This merger eventually turned into Massey Ferguson. He also opened the Banner lane plant in Coventry. Ferguson's research division went on to develop various cars and tractors, including the first Formula One 4 wheel drive car.

A blue plaque commemorating Ferguson is mounted on the Ulster Bank building in Donegall Square, Belfast, the former site of his showroom. A granite memorial has been erected to Ferguson's pioneering flight on the North Promenade, Newcastle. A full scale replica of the Ferguson monoplane and an early Ferguson tractor and plough can be seen at the Ulster Folk and Transport Museum at Cultra.

Ferguson was commemorated in 1981 when he appeared on stamps issued by the Irish Post Office in the Republic of Ireland. In Northern Ireland, Ferguson's image appears today on the obverse of £20 sterling notes issued by the Northern Bank.

In 2008 the Harry Ferguson Memorial gardens were officially opened. Situated opposite the house Harry Ferguson lived in, just outside Dromara, Co. Down. A sculpture of Harry Ferguson was erected in the garden and sees the famous man leaning on a fence surveying the view. Sculpted by Whiteabbey based artist, John Sherlock. The gardens are open to the public.

The University of Ulster opened the Harry Ferguson Engineering Village (18th February 2004) on the Jordanstown campus in recognition of the outstanding contribution made by Harry to Engineering and innovation in Ireland.

He died at his home at Stow-on-the Wold in 1960, the result of an barbiturate overdose, a coroner's ruling was unable to conclude whether this had been accidental or deliberate.