Stallman pioneered the concept of copyleft and he is the main author of several copyleft licenses including the GNU General Public License, the most widely used free software license. Since the mid-1990s, Stallman has spent most of his time advocating for free software, as well as campaigning against both software patents and what he sees as excessive extension of copyright laws. Stallman has also developed a number of pieces of widely used software, including the original Emacs, the GNU Compiler Collection,, the GNU Debugger, and many tools in the GNU Coreutils. He co-founded the League for Programming Freedom in 1989.

Stallman was born to Daniel Stallman and Alice Lippman, in 1953 in New York City. His first experience with computers was while in high school at the IBM New York Scientific Center. He was hired for the summer to write a numerical analysis program in Fortran. He completed the task after a couple of weeks and spent the rest of the summer writing a text editor in APL. Stallman spent the summer after his high-school graduation writing another program, a preprocessor for the PL/I programming language on the IBM System/360.

During this time, Stallman was also a volunteer laboratory assistant in the biology department at Rockefeller University. Although he was already moving toward a career in mathematics or physics, his teaching professor at Rockefeller thought he would have a future as a biologist.

In June 1971, as a first-year student at Harvard University, Stallman was known for his strong performance in Math 55, and became a programmer at the MIT Artificial Intelligence Laboratory. There he became a regular in the "hacker" community, where he was usually known by his initials, "rms" (which was the name of his computer accounts). In the first edition of the Hacker's Dictionary, he wrote, "'Richard Stallman' is just my mundane name; you can call me 'rms'." Stallman graduated from Harvard magna cum laude earning a BA in Physics in 1974.

Stallman then enrolled as a graduate student in physics at MIT, but abandoned his graduate studies while remaining a programmer at the MIT AI Laboratory. At the end of his first year in the graduate program, Stallman suffered a knee injury that ended his participation in international folk dancing. Stallman abandoned his pursuit of a doctorate in physics in favor of programming.

While a graduate student at MIT, Stallman published a paper on an AI truth maintenance system called dependency-directed backtracking with Gerald Jay Sussman. This paper was an early work on the problem of intelligent backtracking in constraint satisfaction problems. As of 2003, the technique Stallman and Sussman introduced is still the most general and powerful form of intelligent backtracking. The technique of constraint recording, wherein partial results of a search are recorded for later reuse, was also introduced in this paper.

As a hacker in MIT's AI laboratory, Stallman worked on software projects like TECO, Emacs, and the Lisp Machine Operating System. He would become an ardent critic of restricted computer access in the lab, which at that time was funded primarily by the Defense Advanced Research Projects Agency. When MIT's Laboratory for Computer Science (LCS) installed a password control system in 1977, Stallman found a way to decrypt the passwords and sent users messages containing their decoded password, with a suggestion to change it to the empty string (that is, no password) instead, to re-enable anonymous access to the systems. Around 20% of the users followed his advice at the time, although passwords ultimately prevailed. Stallman boasted of the success of his campaign for many years afterward.

In the late 1970s and early 1980s, the hacker culture that Stallman thrived on began to fragment. To prevent software from being used on their competitors' computers, most manufacturers stopped distributing source code and began using copyright and restrictive software licenses to limit or prohibit copying and redistribution. Such proprietary software had existed before, and it became apparent that it would become the norm. This shift in the legal characteristics of software can be regarded as a consequence triggered by the U.S. Copyright Act of 1976, as stated by Stallman's MIT fellow Brewster Kahle.

When Brian Reid in 1979 placed "time bombs" in Scribe to restrict unlicensed access to the software, Stallman proclaimed it "a crime against humanity." He clarified, years later, that it is blocking the user's freedom that he believes is a "crime", not the issue of charging for the software.

In 1980, Stallman and some other hackers at the AI Lab were refused access to the source code for the software of the first laser printer, the Xerox 9700. Stallman had modified the software on an older printer (the XGP, Xerographic Printer), so it electronically messaged a user when the person's job was printed, and would message all logged-in users when a printer was jammed. Not being able to add this feature to the Dover printer was a major inconvenience, as the printer was on a different floor from most of the users. This one experience convinced Stallman of people's need to be free to modify the software they use. Richard Greenblatt, a fellow AI Lab hacker, founded Lisp Machines, Inc. (LMI) to market Lisp machines, which he and Tom Knight designed at the lab. Greenblatt rejected outside investment, believing that the proceeds from the construction and sale of a few machines could be profitably reinvested in the growth of the company. In contrast, the other hackers felt that the venture capital-funded approach was better. As no agreement could be reached, hackers from the latter camp founded Symbolics, with the aid of Russ Noftsker, an AI Lab administrator. Symbolics recruited most of the remaining hackers including notable hacker Bill Gosper, who then left the AI Lab. Symbolics forced Greenblatt to also resign by citing MIT policies. While both companies delivered proprietary software, Stallman believed that LMI, unlike Symbolics, had tried to avoid hurting the lab's community. For two years, from 1982 to the end of 1983, Stallman worked by himself to clone the output of the Symbolics programmers, with the aim of preventing them from gaining a monopoly on the lab's computers.