Paffett began in karting in 1993, finishing third in the British Cadet Championships. He won the British Junior TKM Championship in 1995 and finished second in the Junior ICA European Championship the same year. In 1996 he was awarded the McLaren Mercedes Karting Champion of the Future award. In 1997 he moved into single-seaters, winning the Formula Vauxhall Junior Winter Series and the best newcomer's award. He dominated the 1998 Formula Vauxhall Junior Class B season with thirteen poles and thirteen wins, then won promotion to the main Formula Vauxhall Junior class and took that championship with two track records, four wins, five fastest laps, and three pole positions. At the end of 1998 he was awarded the McLaren Autosport BRDC Young Driver of the Year award.
Competing in the British F3 Championship Scholarship class, Paffett won the title with twelve wins, thirteen fastest laps, and thirteen pole positions. He moved to the German Formula Three Championship in 2001 with Team Rosberg, finishing sixth overall. He dominated the 2002 German F3 season, winning the championship and never losing the series lead.
Paffett's planned move to International Formula 3000 for 2003 with Brand Motorsport was abandoned when that team withdrew from the series. Mercedes then signed him to drive in the DTM for Team Rosberg in a year-old AMG-Mercedes CLK-DTM, and he finished eleventh in his debut season.
In 2004, upgraded to the current-specification AMG-Mercedes C-Class with the HWA team, Paffett won four races and took one pole position to finish runner-up in the championship. He became champion the following year in 2005 with five wins and four pole positions, succeeding Mattias Ekström as title holder.
After stepping back from DTM during the 2006 season to focus on McLaren F1 testing, Paffett returned in 2007 with Persson Motorsport in a year-old car. At Oschersleben in 2007 he became the first driver in the history of the series to win in a year-old specification car. He remained with Persson in 2008 before returning to the HWA team for 2009, when he finished runner-up in the championship behind Timo Scheider. He was runner-up again in 2010 and 2012, and finished second overall in 2012 behind Bruno Spengler. Over subsequent seasons he remained competitive without challenging for the title.
For 2018 — Mercedes' final DTM season before withdrawing from the series — Paffett, driving for Mercedes-AMG Motorsport Petronas with the HWA team, produced his strongest campaign. He won the opening race at Hockenheim, added a second win at Lausitzring, won a third time at Zandvoort, and collected three second places and four third places across the season. The accumulated results were sufficient to deliver Paffett and Mercedes the 2018 championship title. He succeeded René Rast as champion and was himself succeeded by Rast in 2019.
In December 2005 Paffett was announced as McLaren's full-time test driver for the 2006 season alongside Pedro de la Rosa, giving up his DTM title defence. He remained associated with McLaren in a testing and reserve capacity for several years. When Kimi Räikkönen left McLaren for Ferrari and Lewis Hamilton arrived, Paffett was not offered the race seat that had briefly been speculated upon. He was briefly released from his McLaren contract in October 2006 but was quickly re-signed as second test driver. In 2012 he served as Force India's reserve driver for the Australian Grand Prix when regular reserve Jules Bianchi was unavailable due to Formula Renault 3.5 testing commitments. He departed McLaren at the end of 2014, coinciding with the team's switch to Honda engines.
From 2016 Paffett joined Williams as a simulator driver alongside his DTM duties. Claire Williams described him as "a highly professional racing driver" whose testing knowledge and data analysis ability would help development of the FW38.
In the 2018-19 Formula E season Paffett drove for HWA Racelab alongside Stoffel Vandoorne in a Spark SRT05e chassis with a Venturi powertrain — marking both his and the team's debut in the all-electric series. He scored points in Hong Kong, Paris, and New York City and finished the season nineteenth in the drivers' standings with nine points. On 11 September 2019 it was announced he would be replaced by Nyck de Vries for the new Mercedes-Benz EQ team for the 2019-20 season. Paffett moved into a sporting and technical advisory role within the team while also serving as test and reserve driver.
Paffett's championship titles include the 2005 and 2018 Deutsche Tourenwagen Masters, the 2002 German Formula Three Championship, the 2000 British F3 National Class title, the Formula Vauxhall Junior Championship, the Formula Vauxhall Junior Class B Championship, and the Formula Vauxhall Junior Winter Series. He received the McLaren Autosport BRDC Award in 1999.
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