Manhire attended the Otago Boys' High School, and later the University of Otago in Dunedin where he received his B.A. in 1967, his M.A. (with honors) in 1968, and his M.Litt. in 1970. He went on to study at University College, London (1970-73, M.Phil)

His work has won the New Zealand Book Awards poetry prize five times, in 1978, 1985, 1992,1996 and his most recent work Lifted received the 2006 Montana New Zealand Book Awards Poetry Prize.

Manhire has been a strong promoter of local poetry and other writing, acting as editor of several compilations of New Zealand short stories, most notably Some Other Country (1984) and Six by Six (1989). His collection of New Zealand poetry, 100 New Zealand Poems (1993), proved particularly popular, and was subsequently expanded to become 121 New Zealand Poems (2005). He also helped start the Best New Zealand Poems series, which began selecting poems in 2001.

For the 25th anniversary of the Erebus air disaster, Manhire wrote the poem "Erebus Voices", which was read by Sir Edmund Hillary at the commemorative service at Scott Base, Antarctica.

Bill Manhire currently lectures in English and creative writing at Victoria University of Wellington, where he is also the director of the International Institute of Modern Letters. Some of the work of his former students was published in the volume Mutes and Earthquakes in 1997.