Born in Upland, California, Lawson grew up riding motorcycles on the Southern California dirt track circuit, a passion shared by his father and grandfather. He also competed in karts as a youngster but ultimately committed to two wheels. When dominant Harley-Davidson machinery made dirt track increasingly difficult to contest, he turned to road racing.
In 1979 Lawson finished the AMA 250cc road racing National Championship in second place behind Freddie Spencer. He then joined the Kawasaki Superbike team and won the AMA Superbike Series in both 1981 and 1982, while also capturing the AMA 250cc National Championship in 1980 and 1981.
Yamaha offered Lawson a seat in the 500cc World Championship for 1983 as teammate to Kenny Roberts. He spent that first season learning the international circuits and in 1984 began winning regularly, claiming his first world title. Three more 500cc championships followed: in 1986 and 1988 for Yamaha, and in 1989 for Honda.
The 1989 title was the most historically significant. Lawson had shocked the paddock by leaving Yamaha to join their arch-rivals Rothmans Honda as teammate to 1987 world champion Wayne Gardner. When Gardner broke his leg during the third round at Laguna Seca, Lawson went on to win the championship, becoming the first rider to claim back-to-back 500cc titles with different manufacturers. Valentino Rossi replicated this achievement in 2004.
In 1986 Lawson also won the Daytona 200 in dominant fashion, setting a race record at an average of 106.030 mph that demolished the previous mark set by Freddie Spencer by more than three minutes.
Lawson switched to Cagiva for 1991. In 1992 he took his final Grand Prix victory — also the first win for Cagiva in ten years of racing — joining a small group of riders to have won premier-class races with three different manufacturers.
When Lawson retired from Grand Prix racing in the early 1990s, he ranked third on the all-time 500cc/MotoGP class wins list with 31 victories. He came out of retirement to win his second Daytona 200 in 1993.
After his Grand Prix career ended, Lawson pursued open-wheel single-seater racing in the United States. He competed in the Indy Lights series and eventually moved to CART, contesting 11 races in the 1996 IndyCar season with two sixth-place finishes as his best results, at the U.S. 500 and the Detroit Indy Grand Prix.
In 1990 he won the Suzuka 8 Hours endurance race on a Yamaha FZR750R alongside teammate Tadahiko Taira.
Lawson was inducted into the Motorcycle Hall of Fame in 1999, the Motorsports Hall of Fame of America in 2002, and the FIM MotoGP Hall of Fame in 2005. His combination of smoothness, racecraft, and the ability to adapt to different machinery across Yamaha, Honda, and Cagiva set a template for professional versatility that few of his era matched. His nickname "Steady Eddie" encapsulated a philosophy of consistent point-scoring and mechanical sympathy that brought him four world championships over a five-year span.