Arbuthnot was a twin, the son of Alexander Arbuthnot, Bishop of Killaloe. His older brother, Alexander John Arbuthnot, became a senior civil servant in India. His half-brother, George Bingham Arbuthnot, was an honorary Major General and Colonel of the Madras Light Cavalry in India. He was educated at Rugby, attended the Royal Military Academy, and was commissioned as second lieutenant in the Royal Artillery on 17 June 1843.
Arbuthnot served in the Crimean War as a captain in the 10th Battalion of the Royal Artillery. He was slightly wounded in minor actions near Sevastopol on 17 June 1855. He received a severe wound on 23 August 1855. He was appointed a Companion of the Order of the Bath (CB), later advanced to become a Knight Commander of the Knight Commander of the Order of the Bath (KCB) and eventually made Knight Grand Cross of the Order of the Bath (GCB) in May 1894.
He went to India in 1868, and was actively employed in the Anglo-Afghan War. On his return to England in 1880, Arbuthnot was appointed deputy adjutant-general of artillery, then inspector-general of artillery, and finally president of the ordnance committee. According to his article in the Dictionary of National Biography "his firmness and justice made him a highly respected administrator"
He returned to India in 1886 as Commander-in-chief of the Madras Army, the army of the Madras Presidency and one of the three major armies that constituted the bulk of British forces in India. He served as senior military adviser for the Madras Presidency until 1890. He was appointed Colonel Commandant Royal Artillery 1893.
Arbuthnot married Caroline Charlotte Clarke on 27 October 1868. She had been born in Barbados in 1845-6, where her father, William Clarke, was a doctor. Their children included Brigadier General Alexander George Arbuthnot. She survived her husband, dying in 1909.