Born at near Rockingham in Richmond County, North Carolina, Steele attended common schools near his home and then Randolph-Macon College in Ashland, Virginia, Wake Forest College, and finally the University of North Carolina at Chapel Hill, graduating in 1844.
Steele was elected to two-years terms in the North Carolina House of Commons in 1846, 1848, 1850, and 1854; he rose to the North Carolina Senate, serving there between 1852 and 1858, and in 1852, he was named as a trustee of the University of North Carolina at Chapel Hill, a post he held until his death.
A delegate to the 1860 Democratic National Conventions in Charleston and Baltimore, Steele chaired the 1861 state convention which passed the ordinance of secession at the beginning of the American Civil War. Steele studied law and was admitted to the bar in 1865 and practiced law in his hometown of Rockingham.
Walter L. Steele died in Baltimore, Maryland in 1891 and is buried in Leak Cemetery near Rockingham, North Carolina.