Larson was born and raised in University Place, Washington. His parents are Verner, a car salesman, and Doris, a secretary. He attended Curtis Senior High School before attending Washington State University, from which he graduated in 1972 with a degree in communications. In 1987, Larson married Toni Carmichael, an anthropologist. Ms. Carmichael graduated from Safford High School in 1972 before attending college.

Larson credits his older brother, Dan, for his "paranoid" sense of humor. Dan pulled countless pranks on Gary, taking advantage of his phobia of monsters under the bed by waiting in the closet for the right moment to pounce. He is also credited for nurturing Gary's love of science. They caught animals in Puget Sound and placed them in terrariums in the basement, even making a small desert ecosystem. Larson's use of snakes in his cartoons stems from his long-standing interest in herpetology. Dan died of cancer in 1991.

According to Larson in his anthology, The Prehistory of the Far Side, he was working in a music store when he took a few days off, after finally realizing how much he hated his job. During that time, he decided to try cartooning and drew six cartoons and submitted them to Pacific Search (now Pacific Northwest Magazine), a Seattle-based magazine. After contributing to another local Seattle paper, in 1979 Larson submitted his work to The Seattle Times. His work was published weekly under the title Nature’s Way (it was placed next to the Junior Jumble).

To supplement his income, Larson worked for the Humane Society. Larson soon decided he could increase his income from cartooning by selling his strip to another newspaper. Taking his vacation in San Francisco, Larson pitched his work to the San Francisco Chronicle. To Larson’s surprise, the Chronicle bought the strip and promoted it for syndication, renaming it "The Far Side." This all occurred a week before The Seattle Times dropped Nature’s Way.

In The Complete Far Side, Larson says that his greatest disappointment in life occurred when he was at a luncheon and sat across from Charles Addams. Larson was not able to think of a single thing to say to him, and deeply regretted the missed opportunity.

Since retiring from the Far Side, Larson has occasionally done some cartooning work, such as magazine illustrations and promotional artwork for Far Side merchandise.

In 1998 Larson published his first post-Far Side book, There's a Hair in My Dirt!: A Worm's Story, an illustrated story with the Far Side mindset.

Nature's Way, the precursor to The Far Side first appeared in the Seattle Times in 1979. After Larson’s success with the San Francisco Chronicle, The Far Side was syndicated in 1980 by Chronicle Features. Its first appearance in the Chronicle was on January 1, 1980. It ran for 15 years until Larson retired with his final strip published on January 1, 1995. Larson thought the series was getting repetitive and did not want to enter what he called the "Graveyard of Mediocre Cartoons."

Themes in The Far Side were often surreal, such as “How cows behave when no human watches” or "The unexpected dangers of being an insect." Often, the behavior of supposedly superior humans was compared with animals: surrounded by fences and dense housing, a father explains to his son that a bird song is a territorial marking common to the lower animals. Animals and other creatures were frequently presented anthropomorphically. For example, one strip depicts a family of spiders driving in a car with a "Have a Nice Day" bumper sticker, featuring a "smiley face" with eight eyes.

One of Larson's more famous cartoons shows a chimpanzee couple grooming. The female finds a blonde human hair on the male and inquires, "Conducting a little more 'research' with that Jane Goodall tramp?" The Jane Goodall Institute thought this was in bad taste, and had their lawyers draft a letter to Larson and his distribution syndicate, in which they described the cartoon as an "atrocity". They were stymied by Goodall herself, who revealed that she found the cartoon amusing. Since then, all profits from sales of a shirt featuring this cartoon go to the Goodall Institute.

Goodall wrote a preface to The Far Side Gallery 5, detailing her version of the "Jane Goodall Tramp" controversy. She praised Larson's creative ideas, which often compare and contrast the behavior of humans and animals. In 1988, Larson visited Gombe Streams National Park and was attacked by Frodo, a chimp described by Goodall as a "bully." Larson escaped with cuts and bruises.

Larson's Far Side cartoons were syndicated worldwide and published in many collections. They were reproduced extensively on greeting cards which continue to be popular. Two animated versions, "Tales from the Far Side" and "Tales from the Far Side II", were produced for television.

Larson published a 2007 calendar with all author royalties donated to Conservation International.

There's a Hair in My Dirt!: A Worm's Story is a short illustrated story of a worm who feels his life is insignificant. The main plot is told by the young worm's father and follows a beautiful maiden named Harriet, who takes a stroll across a woodland trail, encountering different aspects of the natural world. She admires it, but knows little about the land around her, and that eventually leads to her downfall. The story became a New York Times bestseller.

Larson was awarded the Newspaper Panel Cartoon Award by the National Cartoonist Society in 1985 and 1988. Larson earned the society’s Reuben Award for 1990 and 1994. Larson has been recognized for various individual strips by the National Cartoonist Society in 1989, 1990, 1991, 1993 and 1995.On March 15, 1989, a newly discovered insect species was named after Larson by Dale H. Clayton, head of the Committee of Evolutionary Biology at the University of Chicago. The Strigiphilus garylarsoni is a biting louse of a genus only found on owls. Wrote Larson: "I considered this an extreme honor. Besides, I knew no one was going to write and ask to name a new species of swan after me. You have to grab these opportunities when they come along." A 8"x11" magnification of the insect appeared in the Prehistory of the Far Side 10th anniversary compilation, along with the letter requesting permission to use his name. A similar thing happened when an Ecuadorian rain forest butterfly was named after him; Serratoterga larsoni. The Garylarsonus beetle carries his name. Curiosities of Biological Nomenclature: Etymologies The term "thagomizer", a feature of stegosaurus anatomy, was coined in a Far Side cartoon.

In 2003, Larson drew a cover for the November 17 edition of The New Yorker magazine, an offer he felt was too prestigious to refuse.

Larson is a jazz guitarist. In exchange for guitar lessons from Herb Ellis, he provided the cover illustration for the album Doggin' Around (Concord, 1988) by Ellis and bassist Red Mitchell.

Larson voices himself in the Simpsons episode Once Upon a Time in Springfield.