Carr-Saunders was born in Reigate, Surrey and educated at Eton and Magdalen College, Oxford where he gained a 1st in zoology in 1908. He remained a year at Oxford as a demonstrator in comparative anatomy but left in 1910 to University College London where he studied biometrics under Karl Pearson. Deciding against natural science, he instead read for the Bar of the Inner Temple.
Concerned about all kinds of social ills and problems, he saw a solution in Eugenics for the engineering of society into a better condition. He became the secretary of the Eugenics Education Society and lived at Toynbee Hall.
When the Great War broke in 1914, he attempted to obtain a commission in the London Scottish Regiment, but was instead commissioned into the Royal Army Service Corps and was posted to a ration depot at Suez, due to the high standard of his French.
After the Armistice he returned to the Oxford Zoology department, taking an interest in ecological issues, especially population and overpopulation. He participated in one of the firsts Oxford Expeditions to Spitsbergen in the Artic in 1921 as main scientists, together with Julian Huxley. During the expedition he depured his early ideas on population dynamics and summarized them in a book called The Population Problem. The book used a neo-Malthusian argument plus Galton's eugenics as the theoretical framework for a quantitative analysis of population dynamics. The population problem arose -according to Carr-Saunders analysis- from the fact of having high reproductive rates among primitive people with low mental and physical qualities. Over-population of these lower races endangered the standard of living of races bearing higher qualities. Unlike Malthus, he thought that industrial productivity and not food was the main limiting factor in human populations.
The success of his magnum opus The Population Problem resulted in his appointment to the Charles Booth Chair of Social Science at the University of Liverpool in 1923. In 1937, he was appointed to succeed Sir William Beveridge as Director of the London School of Economics, and held that post until his retirement in 1955. He served on the Royal Commission on Population, 1944 - 1949.
Carr-Saunders was one of the mentors of the animal ecologist Charles Elton, greatly influencing Elton's approach toward animal ecology as a "sociology and economy of animals Knighted in 1946, and created FBA in 1946 and KBE in 1957.