Finch was born Frederick George Peter Ingle-Finch in London to Australian parents, who divorced when he was two years old. He was raised by relatives in France, India, and Australia, where they moved when he was 10 years old, growing up in Sydney. Finch was also known by the "alternate name" of William Mitchell.

After finishing school, Finch took several badly paid jobs until he tried acting in 1935. He worked in both radio and theater before landing his first film in 1938, Dad and Dave Come to Town.

Finch's forte, however, remained in stage roles. He was noticed by Laurence Olivier in the late 1940s. Olivier, at the time a powerful force in London theater circles, encouraged Finch to return to London for a role in Daphne Laureola at the Old Vic.

During this time, his closeness to the Olivier family led to an affair with Olivier's beautiful but increasingly unstable wife, Vivien Leigh, which began in 1948, and continued on and off for several years, ultimately falling apart due to her deteriorating mental condition.

Despite his stage experience, Finch, like his mentor Olivier, suffered from stage fright. As a break from stage parts, in the late 1940s, he turned to performing in films. His first role in a British-made film was in Eureka Stockade (1949), set in Australia.

In 1950, he made his Hollywood film debut in The Miniver Story, the sequel to the wartime blockbuster movie Mrs. Miniver; unlike its predecessor, it was poorly received critically.[citation needed] In 1955, he appeared with Diane Cilento in the film Passage Home. His first major role was in 1956's A Town Like Alice.

In 1972, Finch played the homosexual Jewish doctor in Sunday, Bloody Sunday, earning an Academy Award nomination for Best Actor in a Leading Role.

At the time of his death, he was doing a promotional tour for the 1976 film Network in which he made an over-the-top portrayal of the "crazed" television anchorman Howard Beale. He was posthumously nominated for a Best Actor Oscar for that role, winning the award, which was accepted by his widow, Aletha Finch.

Although James Dean, Spencer Tracy, and Massimo Troisi had also been posthumously nominated for a Best Actor Oscar, Peter Finch is the only actor to have won the award posthumously, as well as the first Australian actor to win that Best Actor award.

Including his last Best Actor award for Network, Finch also won five Best Actor awards from the British Academy of Film and Television Arts (BAFTA).