Baxter was born at Rowton, Shropshire, at the house of his maternal grandfather. Richard's early education was poor, being mainly in the hands of the local clergy, themselves virtually illiterate. He was helped by John Owen, master of the free school at Wroxeter, where he studied from about 1629 to 1632, and made fair progress in Latin. On Owen's advice he did not proceed to Oxford (a step which he afterwards regretted), but went to Ludlow Castle to read with Richard Wickstead, chaplain to the Council of Wales and the Marches.

He was reluctantly persuaded to go to court, and he went to London under the patronage of Sir Henry Herbert, Master of the Revels, with the intention of doing so, but soon returned home, resolved to study divinity. He was confirmed in the decision by the death of his mother.

After three months spent working for the dying Owen as a teacher at Wroxeter, Baxter read theology with Francis Garbet, the local clergyman, adding to his reading (initially in devotional writings, of Richard Sibbes, William Perkins and Ezekiel Culverwell, as well as the Calvinist Edmund Bunny at age 14, and then in the scholastic philosophers) orthodox Church of England theology in Richard Hooker and George Downham, and arguments from conforming puritans in John Sprint and John Burges. In about 1634, he met Joseph Symonds (assistant to Thomas Gataker) and Walter Cradock, two Nonconformists.

Dudley and Bridgnorth

In 1638 Baxter became master of the free grammar school at Dudley, where he commenced his ministry, having been ordained and licensed by John Thornborough, Bishop of Worcester. His success as a preacher was at first small; but he was soon transferred to Bridgnorth, in Shropshire, where, as assistant to a Mr Madstard, he established a reputation for conscientiousness.

Baxter remained at Bridgnorth for nearly two years, during which time he took a special interest in the controversy relating to Nonconformity and the Church of England. He soon became alienated from the Church on several matters; and after the requirement of the "et cetera oath", he rejected episcopacy in its English form. He became a moderate Nonconformist; and continued as such throughout his life. Though regarded as a Presbyterian, he was not exclusively tied to Presbyterianism, and often seemed prepared to accept a modified Episcopalianism. All forms of church government were regarded by him as subservient to the true purposes of religion.

Kidderminster

One of the first measures of the Long Parliament was to reform the clergy; with this view, a committee was appointed to receive complaints against them. Among the complainants were the inhabitants of Kidderminster. The vicar George Dance agreed that he would give £60 a year, out of his income of £200, to a preacher who should be chosen by certain trustees. Baxter was invited to deliver a sermon before the people, and was unanimously elected as the minister. This happened in April 1641, when he was twenty-six.His ministry continued, with many interruptions, for about nineteen years; and during that time he accomplished many reforms in Kidderminster and the neighbourhood. He formed the ministers in the country around him into an association, uniting them irrespective of their differences as Presbyterians, Episcopalians and Independents. The Reformed Pastor was a book which Baxter published in relation to the general ministerial efforts he promoted.

The English Civil War

On the outbreak of the First English Civil War, Baxter blamed both parties and recommended the Protestation; but Worcestershire was a Royalist county, and he was exposed to annoyance and danger in Kidderminster. He temporarily retired to Gloucester. He was preaching at Alcester, on 23 October 1642, during the battle of Edgehill. He returned, but only to be driven out again. He moved next to Coventry. There he found himself with no fewer than thirty fugitive ministers, among whom were Richard Vines, Anthony Burges, John Bryan and Obadiah Grew. He officiated as chaplain to the garrison, preaching once each Sunday to the soldiers, and once to the townspeople and strangers, including Sir Richard Skeffington, Colonel Godfrey Bosville, George Abbot the layman scholar, and others. After the Battle of Naseby he took the situation of chaplain to Colonel Edward Whalley's regiment, and continued to hold it till February 1647. During these stormy years he wrote his Aphorisms of Justification, which on its appearance in 1649 excited great controversy. Of numerous critics the one with whom Baxter engaged most closely was Christopher Cartwright.

He regretted that he had not previously accepted Oliver Cromwell's offer to become chaplain to the Ironsides. Cromwell avoided him; but Baxter, having to preach before him after he had assumed the Protectorship, chose for his subject the old topic of the divisions of the church, and in subsequent interviews argued with him about liberty of conscience, and even defended the monarchy he had subverted. This contact with Cromwell occurred when Baxter was summoned to London to assist in settling "the fundamentals of religion".

In 1647, Baxter was staying at the home of Lady Rouse, wife of Sir Thomas Rouse, 1st Baronet, of Rouse Lench in Warwickshire. There, though debilated by illness, he wrote the most of a major work, The Saints' Everlasting Rest (1650).

Return to Kidderminster

On his recovery he returned to Kidderminster, where he also became a prominent political leader, his sensitive conscience leading him into conflict with almost all the contending parties in state and church. A debate all day on 1 January 1650 with John Tombes at Bewdley ended in confused disorder.

After the Restoration in 1660 Baxter, who had helped to bring about that event, settled in London. He preached there till the Act of Uniformity 1662 took effect, and looked for such terms of comprehension as would have permitted the moderate dissenters with whom he acted to have remained in the Church of England. In this hope he was sadly disappointed. Church leaders did not wish for such comprehension, and their objective in negotiation was to excuse their own breach of faith. The Savoy conference resulted in Baxter's Reformed Liturgy, though it was cast aside without consideration.

The same reputation which Baxter had obtained in the country he secured in London. The power of his preaching was universally felt, and his capacity for business placed him at the head of his party. He had been made a king's chaplain, and was offered the bishop of Hereford, but he could not accept the offer without assenting to things as they were.

After his refusal he was not allowed, even before the passing of the Act of Uniformity, to be a curate in Kidderminster, and Bishop George Morley prohibited him from preaching in the diocese of Worcester. Baxter married on 24 September 1662 Margaret Charlton, a woman like-minded with himself. She died in 1681. Baxter wrote the words for the hymn Ye Holy Angels Bright in that year.

Legal troubles

From 1662 until the indulgence of 1687, Baxter's life was constantly disturbed by persecution of one kind or another. He retired to Acton in Middlesex, for the purpose of quiet study, but was placed in prison for keeping a conventicle. Baxter procured a habeas corpus in the court of common pleas.

He was taken up for preaching in London after the licences granted in 1672 were recalled by the king. The meeting house which he had built for himself in Oxendon Street was closed to him after he had preached there only once.

In 1680, he was taken from his house; and though he was released that he might die at home, his books and goods were seized. In 1684, he was carried three times to the sessions house, being scarcely able to stand, and without any apparent cause was made to enter into a bond for £400 in security for his good behaviour.

But his worst encounter was with the chief justice, Sir George Jeffreys, in May 1685. He had been committed to the King's Bench Prison on the charge of libelling the Church in his Paraphrase on the New Testament, and was tried before Jeffreys on this accusation. No authoritative report of the trial exists; if the partisan account on which tradition is based is accepted, Jeffreys was infuriated. Baxter was sentenced to pay 500 marks, to lie in prison till the money was paid, and to be bound to his good behaviour for seven years. Jeffreys is even said to have proposed he should be whipped behind a cart. Baxter was now seventy, and remained in prison for eighteen months, until the government, hoping to win his influence, remitted the fine and released him.

Baxter's health had grown even worse, yet this was the period of his greatest activity as a writer. He wrote 168 or so separate works, including major treatises such as the Christian Directory, the Methodus Theologiae Christianae, and the Catholic Theology. His Breviate of the Life of Mrs Margaret Baxter records the virtues of his wife. A slim devotional work published in 1658 under the title Call to the Unconverted to Turn and Live formed one of the core extra-biblical texts of evangelicalism until at least the middle of the nineteenth century.

The remainder of his life, from 1687 onwards, was passed peacefully. He died in London, and his funeral was attended by churchmen as well as dissenters.

Richard Baxter held to a form of Amyraldism, a less rigorous, though more moderate, form of Calvinism which rejected the idea of a limited atonement in favor of a universal atonement similar to that of Hugo Grotius. He devised an eclectic middle route between Bezan Reformed, Grotius Arminian, John Cameron's Amyraldism, and Augustine's Roman doctrines of grace: interpreting the kingdom of God in terms of Christ as Christus Victor and Rector of all men. He explained Christ’s death as an act of universal redemption (penal and vicarious, though substitutionary in explication), in virtue of which God has made a "new law" offering pardon and amnesty to the penitent. Repentance and faith, being obedience to this law, are the believer’s personal saving righteousness.

The evaluation of Baxter, but often begins at the level of understanding his position as such. These differences in interpretation probably arise from a combination of factors: (1) where Baxter's soteriology, or his theology in general, constitutes but one of a number of issues investigated, some inaccuracies may arise. (2) The scholar's own theological preferences may cause him to present a biased picture of Baxter's theology, whether that be done consciously or unconsciously. (3) Baxter's discussions are often extremely intricate. In a real sense, Baxter is a scholastic theologian. His constant use of distinctions is nearly proverbial among his critics as well as his students. To understand Baxter's theological positions one must go through the arduous process of analyzing the numerous distinctions he makes. Neglecting to sort out the various nuances in these distinctions may easily lead to a misunderstanding of certain aspects of Baxter's theology. (4) Baxter's theological system is a tightly knit unit. Once Baxter's theological method is grasped, the various pieces fit together. Prior to one's unlocking of Baxter's theological system, however, it is often difficult to locate its constitutive elements. This lack of understanding may result in an inaccurate portrayal of his theology.

The disagreements are not restricted to some incidental points. Indeed, it is a much debated question how Baxter's theology must be identified. Of course, Baxter styled himself a "Catholic Christian," an adherent to "meer Christianity." But this does not take away the need to come to a more theologically determined circumscription of his position. Some regard Baxter as a Calvinist. Others, however, interpret his theology as Amyraldian or Arminian. Then again, his theology has been described as Roman Catholic or even Socinian.

Baxter insisted that the Calvinists of his day, armed with their unyielding allegiance on the sola fide of the Reformation, ran the danger of ignoring the conditions that came with God's gift of the covenant of grace. Justification, Baxter insisted, required at least some degree of faith and works as the human response to the love of God: "[I]f in acknowledgement of the favour of his Redemption, he will but pay a pepper corn, he shall be restored to his former possession, and much more."

Baxter's theology was set forth most elaborately in his Latin Methodus theologiæ Chriatianæ (London, 1681); the Christian Directory (1673) contains the practical part of his system; and Catholic Theology (1675) is an English exposition. His theology made Baxter very unpopular among his contemporaries and caused a split among the Dissenters of the eighteenth century. As summarized by Thomas W. Jenkyn, it differed from the Calvinism of Baxter's day on four points:

1. The atonement of Christ did not consist in his suffering the identical but the equivalent punishment (i.e., one which would have the same effect in moral government) as that deserved by mankind because of offended law. Christ died for sins, not persons. While the benefits of substitutionary atonement are accessible and available to all men for their salvation; they have in the divine appointment a special reference to the subjects of personal election.
2. The elect were a certain fixed number determined by the decree without any reference to their faith as the ground of their election; which decree contemplates no reprobation but rather the redemption of all who will accept Christ as their Savior.
3. What is imputed to the sinner in the work of justification is not the righteousness of Christ but the faith of the sinner himself in the righteousness of Christ.
4. Every sinner has a distinct agency of his own to exert in the process of his conversion. The Baxterian theory, with modifications, was adopted by many later Presbyterians and Congregationalists in England, Scotland, and America (Isaac Watts, Philip Doddridge, and many others).

Baxter is best understood as an eclectic scholastic covenantal theologian for whom the distinction between God's conditional covenant (the voluntas de debito) and his absolute will (the voluntas de rerum eventu) is key to the entire theological enterprise. Despite the difficulty in classifying Baxter, his emphasis on the conditionality of the covenant of grace and therefore on the necessity of faith and works for our standing before God is undeniable.

Our most valuable source is Baxter's autobiography, called Reliquiae Baxterianae or Mr Richard Baxter's Narrative of the most memorable Passages of his Life and Times (published by Matthew Sylvester in 1696). Edmund Calamy the Younger abridged this work (1702). The abridgment forms the first volume of the account of the ejected ministers, but whoever refers to it should also acquaint himself with the reply to the accusations which had been brought against Baxter, and which will be found in the second volume of Calamy's Continuation. William Orme's Life and Times of Richard Baxter appeared in 2 vols. in 1830; it also forms the first volume of "Practical Works" (1830, reprinted 1868). Sir James Stephen's interesting paper on Baxter, contributed originally to the Edinburgh Review, is reprinted in the second volume of his Essays. See also the estimates of Baxter given by John Tulloch in his English Puritanism and Its Leaders, and by Dean Stanley in his address at the inauguration of the statue to Baxter at Kidderminster (see Macmillan's Magazine, xxxii. 385). Geoffrey Nuttall lists 141 books written by Baxter in his biography of Baxter published in 1965.

There is a portrait of Baxter in Dr Williams's Library, Gordon Square, London.

A tribute of general esteem was paid to him nearly two centuries later, when a statue was erected to his memory at Kidderminster. Unveiled 28 July 1875, sculpted by Sir Thomas Brock. Originally in the Bull Ring but moved to its present site, outside St Mary's parish church, March 1967. There have also been numerous sightings of the ghost of an old man in this area that some individuals have identified as possibly being that of Baxter.

Baxter House, a boarding house at Old Swinford Hospital school in Stourbridge, is named after him.

The high school, Baxter College, in Kidderminster, is named after him.

Baxter's House in Bridgnorth is still standing near the High Street with a name plaque on the front.

In 1674, Baxter cast in a new form the substance of Arthur Dent's book The Plain Man's Pathway to Heaven under the title, The Poor Man's Family Book. In this way, Arthur Dent of South Shoebury was a link between Baxter and another great Puritan John Bunyan.

Max Weber (1864—1920), the German sociologist, made significant use of Baxter's works in developing his thesis for "The Protestant Ethic and the Spirit of Capitalism" (1904, 1920).

His influence in New England is referenced in the first chapter of the 19th century devotional work "I Will Be A Lady - a book for girls" by Mrs. Tuthill.

Richard Baxter is commemorated in the Calendar of saints of the Episcopal Church in the United States of America with a feast day on December 8.