Waldheim was born in Sankt Andrä - Wördern, a village near Vienna, on 21 December 1918. His father was a Roman Catholic school inspector of Czech origin named Watzlawick (original Czech spelling Václavík) who changed his name that year as the Habsburg monarchy collapsed. Waldheim served in the Austrian Army (1936 – 37) and attended the Vienna Consular Academy, where he graduated in 1939. Waldheim's father was active in the Christian Social Party. Waldheim himself was politically unaffiliated during these years at the Academy. Shortly after the German annexation of Austria in 1938, Waldheim applied for membership in the National Socialist German Students' League (NSDStB), a division of the Nazi Party. Shortly thereafter he became a registered member of the mounted corps of the SA.

On 19 August 1944, in Vienna, he married Elisabeth Ritschel; their first daughter Lieselotte was born the following year. Son Gerhard and daughter Christa followed.

In early 1941 Waldheim was drafted into the Wehrmacht and sent to the Eastern Front where he served as a squad leader. In December 1941 he was wounded but later returned to service. His further service in the Wehrmacht from 1942 to 1945 (at age 24 to 27) was subject of the international dispute in 1985 and 1986. In 1985, in his autobiography, he stated that he was discharged from further service at the front and for the rest of the war years finished his law degree at the University of Vienna and married in 1944. Documents and witnesses which have since come to light reveal that Waldheim’s military service continued until 1945, and that he rose to the rank of Oberleutnant, and confirmed that he married in 1944 and graduated with a law degree from the University of Vienna in 1945.

His functions within the staff of German Army Group E from 1942 until 1945, as determined by the International Commission of Historians, were:

1. interpreter and liaison officer with the 5th Alpine Division (Italy) in April / May 1942, then,
2. O2 officer (communications) with Kampfgruppe West Bosnia June / August 1942,
3. interpreter with the liaison staff attached to the Italian 9th Army in Tirana in early summer 1942,
4. O1 officer in the German liaison staff with the Italian 11th Army and in the staff of the Army Group South in Greece in July / October 1943 and
5. O3 officer on the staff of Army Group E in Arksali, Kosovska Mitrovica and Sarajevo from October 1943 to January / February 1945.

By 1943 he was serving in the capacity of an ordnance officer in Army Group E which was headed by General Alexander Löhr. In 1986, Waldheim said that he had served only as an interpreter and a clerk and had no knowledge either of reprisals against civilians locally or of massacres in neighboring provinces of Yugoslavia. He said that he had known about some of the things that had happened, and had been horrified, but could not see what else he could have done.

Much historical interest has centered on Waldheim's role in Operation Kozara in 1942. According to one post war investigator, prisoners were routinely shot within only a few hundred yards of Waldheim's office, and just 35 km away at the Jasenovac concentration camp. Waldheim later stated "that he did not know about the murder of civilians there."

Waldheim's name appears on the Wehrmacht's "honor list" of those responsible for the militarily successful operation. The Independent State of Croatia awarded Waldheim the Medal of the Crown of King Zvonimir in silver with an oak branches cluster. Later, during the lobbying for his election as U.N. Secretary General, Yugoslav leader Josip Broz Tito awarded Waldheim the Order of the Grand Cross of Yugoslavia.

Waldheim denied that he knew war crimes were taking place in Bosnia at the height of the battles between the Nazis and Tito's partisans in 1943. According to Eli Rosenbaum, in 1944, Waldheim reviewed and approved a packet of anti-Semitic propaganda leaflets to be dropped behind Russian lines, one of which ended, "enough of the Jewish war, kill the Jews, come over."

In 1945, Waldheim surrendered to British forces in Carinthia, at which point he said he had fled his command post within Army Group E, where he was serving with General Löhr, who was seeking a special deal with the British.

After being defeated in his home country's presidential election, he was elected to succeed U Thant as United Nations Secretary - General the same year. As Secretary - General, Waldheim opened and addressed a number of major international conferences convened under United Nations auspices. These included the third session of the U.N. Conference on Trade and Development (Santiago, April 1972), the U.N. Conference on the Human Environment (Stockholm, June 1972), the third UN Conference on the Law of the Sea (Caracas, June 1974), the World Population Conference (Bucharest, August 1974) and the World Food Conference (Rome, November 1974). However, his diplomatic efforts particularly in the Middle East were overshadowed by the diplomacy of then US Secretary of State, Henry Kissinger.

On September 11, 1972, Ugandan dictator Idi Amin sent a telegram to Waldheim, copies of which went to Yasser Arafat and Golda Meir. In the telegram, Amin "applauded the massacre of the Israeli Olympic athletes in Munich and said Germany was the most appropriate locale for this because it was where Hitler burned more than six million Jews." Amin also called "to expel Israel from the United Nations and to send all the Israelis to Britain, which bore the guilt for creating the Jewish state." Among international protest "the UN spokesman said [in his daily press conference] it was not the secretary - general's practice to comment on telegrams sent him by heads of government. He added that the secretary - general condemned any form of racial discrimination and genocide." In 1976, Waldheim described the Israeli rescue of hijacked airline passengers at Entebbe, Uganda, as "a serious violation of the national sovereignty of a United Nations member state (meaning Uganda)."

In 1973 Waldheim rejected requests to wear a Jewish Kippah during a visit to the Israeli Holocaust memorial.

Waldheim was re-elected in 1976 despite some opposition. Waldheim and then U.S. President Jimmy Carter both prepared written statements for inclusion on the Voyager Golden Records, now in deep space. He was the first Secretary - General to visit North Korea, in 1979. In 1980 Waldheim flew to Iran in an attempt to negotiate the release of the American hostages held in Tehran, but Ayatollah Khomeini refused to see him. While in Tehran, it was announced that an attempt on Waldheim's life had been foiled. Near the end of his tenure as Secretary - General, Waldheim and Paul McCartney also organized a series of concerts for the People of Kampuchea to help Cambodia recover from the damage done by Pol Pot. The People's Republic of China vetoed Waldheim's candidature for a third term, and he was succeeded by Javier Pérez de Cuéllar of Peru.

Waldheim had unsuccessfully sought election as President of Austria in 1971, but his second attempt on 8 June 1986 proved successful. During his campaign for the presidency in 1985, the events started that marked the beginning of what became known internationally as the "Waldheim Affair". Before the presidential elections, Alfred Worm revealed in the Austrian weekly news magazine Profil that there had been several omissions about Waldheim's life between 1938 and 1945 in his recently published autobiography. A short time later, the World Jewish Congress alleged that Waldheim had lied about his service as an officer in the mounted corps of the SA, and his time as an ordnance officer in Saloniki, Greece, from 1942 to 1943. Waldheim called the allegations "pure lies and malicious acts". Nevertheless he admitted that he had known about German reprisals against partisans: "Yes, I knew. I was horrified. But what could I do? I had either to continue to serve or be executed." He said that he had never fired a shot or even seen a partisan. His former immediate superior at the time stated that Waldheim had "remained confined to a desk". Former Austrian chancellor Bruno Kreisky denounced the actions of the World Jewish Congress as an "extraordinary infamy" adding that Austrians wouldn't "allow the Jews abroad to ... tell us who should be our President."

Part of the reason for the controversy was Austria's refusal to address its national role in the Holocaust (many including Adolf Hitler were Austrians and Austria became part of the Third Reich). Austria refused to pay compensation to Nazi victims and from 1970 onwards refused to investigate Austrian citizens who were senior Nazis. Stolen Jewish art remained public property until well after the Waldheim affair.

Because the revelations leading to the Waldheim affair came shortly before the presidential election there has been speculation about the background of the affair. Declassified CIA documents show that the CIA had been aware of his war time past since 1945. Some sources report information about Waldheim's wartime past was also previously published by a right wing Austrian newspaper during the 1971 presidential election campaign - including the claim of an SS membership - but the matter was supposedly regarded as unimportant or even advantageous for the candidate at that time.

It has been asserted that his war time past and the discrepancies in his biography must have been well known to both superpowers before he was elected UN secretary and there were rumors that the KGB had blackmailed him during his UN time.

In 1994, former Mossad officer Victor Ostrovsky claimed in his book The Other Side of Deception that Mossad doctored the file of the then UN Secretary General to implicate him in Nazi crimes. These allegedly false documents were subsequently "discovered" by Benjamin Netanyahu in the UN file, and triggered the "Waldheim Affair". Ostrovsky says it was motivated by Waldheim's criticism of Israeli action in Lebanon. Controversy surrounds Ostrovsky and his writings and some of his claims are disputed. Many of them have not been verified from other sources, and critics such as Benny Morris and author David Wise have charged that the book is essentially a novel.

In view of the ongoing international controversy, the Austrian government decided to appoint an international committee of historians to examine Waldheim's life between 1938 and 1945. Their report found no evidence of any personal involvement in those crimes. Although Waldheim had stated that he was unaware of any crimes taking place, the historians cited evidence that Waldheim must have known about war crimes.

In an account of the controversy, Simon Wiesenthal stated that Waldheim was stationed 5 miles from Salonika while, over the course of several weeks, the Jewish community which formed one third of the population there, was sent to Auschwitz. Waldheim denied any knowledge of this. Wiesenthal states:

I could only reply what the committee of historians likewise made clear in its report: "I cannot believe you."

Wiesenthal stated there was no evidence found by the committee that Waldheim took part in any war crimes, but was guilty of lying about his military record. The International Committee in February 1988 concluded, with regard to Waldheim's ability to do something about the crimes he knew that were going on in Yugoslavia and Greece:

In favour of Waldheim is, that he only had very minor possibilities to act against the injustices happening. Actions against these, depending on which level the resistance occurred, were of very different importance. For a young member of the staff, who did not have any military authority on the army group level, the practical possibilities for resistance were very limited and with a high probability would not have led to any actual results. Resistance would have been limited to a formal protest or on the refusal to serve any longer in the army, which would have seemed to be a courageous act, however would have not led to any practical achievement.