He was born in St. Louis, Missouri, where his mother, Charlotte Peters, was a local television personality with one of the earliest TV talk shows, interviewing film stars and politicians as early as 1949. Accompanying his mother to the studio, he would meet such celebrities as Bob Hope and Martin and Lewis. The show influenced Peters' own life:
Growing up in St. Louis, Peters attended Christian Brothers College High School and Washington University, where he studied fine art, became a Sigma Chi member and graduated in 1965. He drew cartoons for the college paper, Student Life, from 1962 to 1965. Peters recalled, "I knew when I was five years old that I wanted to be a cartoonist. As I grew older, I thought it was the only thing I could do."
On his return from his army service, his mentor Bill Mauldin helped him get a job as editorial cartoonist for the Dayton Daily News in Dayton, Ohio. As a joke, he once stood on the building ledge outside the Daily News building for 30 minutes wearing a Superman costume so that he could make an entrance to a meeting through the window in the manner of actor George Reeves entering Perry White's office on The Adventures of Superman.
When his animated editorial cartoons, Peters Postscripts, began on NBC Nightly News in 1981, it was the first time animated editorial cartoons appeared regularly on a prime-time network news program. Peters also hosted the 14-part interview series, The World of Cartooning with Mike Peters, for PBS.
In regard to politics, Peters's editorial stances are generally left of center.
In 1984, he launched Mother Goose and Grimm, distributed by King Features Syndicate. The strip is published in 500 newspapers, and according to King Features, it has a daily readership of 100 million. Peters' editorial cartoons and his comic strip are both distributed through King Features' DailyINK email service.
He met his wife Marian while attending Washington University, and they moved to Chicago where he worked for a year on the art staff of the Chicago Daily News. Drafted into the Army, he spent two years of service as an artist for the Seventh Psychological Operations Group in Okinawa. Mike and Marian Peters have three daughters and six grandchildren.
Beginning February 24, 2012, his strips and editorial cartoons were exhibited by the Key West Art and Historical Society at the Custom House in Key West, Florida. "This exhibit is a self-portrait of the artist," said Claudia Pennington, the Society's executive director. "It looks into the genius of Mike Peters through his early work to the present day."
In 1981, Peters won the Pulitzer Prize for editorial cartooning. He has received recognition for Mother Goose and Grimm with the National Cartoonists Society's 1991 Reuben Award and a nomination for their Newspaper Comic Strip Award in 2000.