He was born Henry McLennan Lauder, in Portobello, Edinburgh. His parents were John and Isabella Lauder, who had seven other children. John Lauder died from pneumonia when Harry was twelve and the family moved back to Isabella's hometown of Arbroath. In order to attend school, Harry went to work in the local flax mill. He entertained his school friends by imitating their teacher who was unimpressed. Harry then went to Hamilton to work in a coal mine with two of his brothers. He used to sing to entertain himself and the other miners as they carried out the dangerous and dirty work. He was encouraged to enter talent competitions where he was quite successful and a second place in one of these gave him a break into music hall entertainment. It was now that Lauder developed his stage persona - of the kilt-wearing, whisky-swigging, 'bawbee'-watching (tight-fisted) Scot - a stereotype that exists in some people's minds today. He was also famous for his crooked walking stick. (The contorted hazlenut, Corylus avellana 'Contorta' is a decorative shrub that is used as a feature plant in gardens and is commonly called Harry Lauder's Walking stick.)

Lauder entertained around the world for forty years, visiting the United States twenty two times as well as Australia (where one of his brothers lived). He wrote many of his own songs which are heard even today: 'I love a Lassie', 'Roamin' in the Gloamin' ', 'Keep Right on to the End of the Road' (which was written after the death of his son).