He was born in Watervliet, New York, one of eight children of Josiah and Elizabeth Phillips Stanford. Stanford's ancestors settled in the Mohawk Valley of New York around 1720. He attended Clinton Liberal Institute, in Clinton, New York, and studied law at Cazenovia Seminary in Cazenovia, New York and later in Albany. He was admitted to the bar in 1848, and then moved to Port Washington, Wisconsin, where he began law practice with Wesley Pierce. He married Jane Elizabeth Lathrop in Albany on September 30, 1850, the same year he was nominated by the Whig Party as Washington County, Wisconsin, District Attorney. He was also the founder of the newspaper in Washington County now known as the Washington Herald.
In 1852, having lost his law library and other property by fire, he moved to California during the California Gold Rush and began mining for gold at Michigan Bluff in Placer County, California. He subsequently went into business with his three brothers, who had preceded him to the Pacific coast. During this time he worked with his brothers as keeper of a general store for miners, served as a Justice of the Peace and helped organize the Sacramento Library Association, which later became the Sacramento Public Library. In 1856 he moved to San Francisco and engaged in mercantile pursuits on a large scale.
As one of "The Big Four" railroad magnates, he cofounded and was made president of the Central Pacific Railroad company in 1861, when he was again nominated to run for Governor of California The railroad's first locomotive was named Gov. Stanford in his honor.
As president of the Central Pacific, he directed its construction over the mountains, building 530 miles in 293 days. As head of the railroad company which built the first transcontinental railway line over the Sierra Nevada, Stanford hammered in the famous golden spike in Promontory, Utah on May 10, 1869. In 1870, the Central Pacific Railroad acquired the Southern Pacific Railroad, forming one of the most powerful railroad monopolies in history.
In 1871, Stanford began experimenting with winemaking, leading to his establishment of his 'Vina' winery.
In 1872 Stanford commissioned Eadweard Muybridge to use newly invented photographic technology to establish whether a galloping horse ever has all four feet off the ground simultaneously, which they do. This project, which illustrated motion through a series of still images viewed together, was a forerunner of motion picture technology.
Stanford moved to San Francisco in 1874, where he assumed presidency of the Occidental and Oriental Steamship Company.
Stanford served as president of Southern Pacific Railroad from 1885 to 1890, while continuing to serve as the head of the Central Pacific Railroad until his death in 1893. As a railroad developer, Stanford encouraged Chinese immigration to find workers for the railroad construction. However, when jobs were scarce, Stanford made them scapegoats. Stanford encouraged the California legislature to pass taxes and unfair regulations which specifically targeted Chinese.
He also owned two wineries, the Leland Stanford Winery, founded in 1869, and run by brother Josiah, and the 55,000 acres (220 km²) Great Vina farm in Tehama County, containing what was then the largest vineyard in the world at 13,400 acres (54 km²), the Gridley tract of 22,000 acres (90 km²) in Butte County and the Palo Alto Stock Farm, which was the home of his famous thoroughbred racers, Electioneer, Anon, Sunol, Palo Alto and Advertiser. The Palo Alto breeding farm gave Stanford University its nickname of The Farm. The Stanfords also owned a stately mansion in Sacramento, California (this was the birthplace of their only son, and now a house museum used for California state social occasions), as well as a home in San Francisco's Nob Hill district. Their Sacramento home is now the Leland Stanford Mansion State Historic Park.
He was the eighth Governor of California, serving from December 1861 to December 1863, and the first Republican governor. During his gubernatorial tenure, he cut the state's debt in half, and advocated for the conservation of forests. He also oversaw the establishment of the California's first state normal school in San José, later to become San José State University. Following Stanford's governorship, the term of office changed from two years to four years, in line with legislation passed during his time in office. He later served slightly more than one term in the United States Senate, from 1885 until his death in 1893 at age 69. He served for four years as Chairman of the U.S. Senate Committee on Public Buildings and Grounds, and his legislative focus included core Populist elements worker cooperatives as a solution to labor conflict, and free silver to enhance economic growth.
With wife Jane, Stanford founded Leland Stanford Junior University as a memorial for their only child, Leland Stanford, Jr., who died as a teenager of typhoid in Florence, Italy while on a trip to Europe. Approximately US$20 million (US$400 million in 2005 dollars) initially went into the university, which held its opening exercises October 1, 1891. The wealth of the Stanford family during the late nineteenth century is estimated at approximately US$50 million ($US1 billion in 2005 dollars).
Leland Stanford died at home in Palo Alto, California on June 20, 1893, and is buried in the Stanford family mausoleum on the Stanford campus. The Memorial Church at Stanford University is also dedicated to his memory.