Newman discovered racing in 1969 while training at the Watkins Glen Racing School in preparation for the film Winning. His instructor, Bob Bondurant, noted that Newman's passion was immediately apparent. Newman entered his first professional event in 1972 at Thompson International Speedway, quietly listed on entry forms as "P. L. Newman" — a pseudonym he continued to use in the racing community.
Through the 1970s, Newman became a regular and competitive presence in Sports Car Club of America (SCCA) events, eventually winning four national championships. He also drove in endurance racing, finishing second place overall in the 1979 24 Hours of Le Mans co-driving a Porsche 935 with Dick Barbour.
From the mid-1970s to the early 1990s, Newman drove for Bob Sharp Racing, competing mainly in Nissan/Datsun machinery in the Trans-Am Series. The association became strong enough that Newman appeared in advertising for the brand in Japan and had a special-edition Nissan Skyline named after him.
In 1976, Newman began exploring professional team ownership, partnering with Bill Freeman to form Newman Freeman Racing. The team competed in the North American Can-Am series in Chevrolet-powered Spyder NFs with Budweiser sponsorship, winning the Can-Am Team Championship in 1979.
In 1983, Newman co-founded Newman/Haas Racing with racing entrepreneur Carl Haas. The Champ Car team became a major force in American open-wheel racing, winning eight drivers' championships under Newman's co-ownership. The team fielded drivers of the highest calibre over its operational life and was consistently competitive at the top of the IndyCar ladder.
Newman also had a brief involvement in NASCAR team ownership, co-founding a research and development team with Hendrick Motorsports. The operation ran as the number 18 car with Greg Sacks driving but shut down after two seasons following the loss of its primary sponsor.
Newman was also a partner in the Atlantic Championship team Newman Wachs Racing, extending his ownership interests to the junior formula ranks.
In 1995, at the 24 Hours of Daytona, Newman became the oldest driver to that point to be part of a winning team in a major sanctioned race, sharing the victory at the age of 70 years and eight days.
He took the pole position in his final professional race in 2007 at Watkins Glen International. A year later, in 2008, friends arranged an informal run at Lime Rock Park for him; observers reported he still reached nine-tenths of his best recorded times. Newman had said he would quit racing "when I embarrass myself"; by all accounts that moment never came.
Lime Rock Park named its No Name Straight the Paul Newman Straight in 2022.
Newman was posthumously inducted into the SCCA Hall of Fame in 2009 and into the Motorsports Hall of Fame of America in 2024. His motorsport life was documented in the 2015 film Winning: The Racing Life of Paul Newman.
Newman voiced Doc Hudson — a retired race car — in Pixar's Cars (2006), a role that brought his lifelong connection to motorsport to a global audience. Archival recordings of Newman's voice were used to include the character in Cars 3 (2017).
Newman/Haas Racing remained one of the definitive examples of a celebrity team ownership that translated into genuine, sustained sporting success rather than a vanity project. Eight drivers' championships across its Champ Car years placed it among the sport's elite operations.