Mayer was born in Scranton, Pennsylvania. While studying law at Cornell Law School he became involved with the Rev-Em Formula Junior team, whose drivers included his brother Timmy Mayer and Peter Revson. After graduating in 1962 he followed his brother and Revson to Europe and joined Bruce McLaren, who was establishing his Formula One team. The death of his brother Timmy in a testing accident in 1964 was a profound blow, but Mayer chose to remain in motorsport.
When Bruce McLaren was killed in a testing accident at Goodwood in June 1970, Mayer assumed control of the McLaren team. The following decade proved to be McLaren's most prolific period in Formula One. Emerson Fittipaldi won the drivers' title with McLaren in 1974, and James Hunt took the championship in a dramatic 1976 season finale. The team was also active across multiple North American series: McLaren competed in USAC and CART Indy car racing and in Can-Am, winning the Indianapolis 500 twice under Mayer's management. A McLaren chassis entered separately by Roger Penske also won the 500.
As the decade drew to a close, McLaren's Formula One form declined. Title sponsor Marlboro engineered a merger with Ron Dennis's Project 4 operation. Mayer became joint managing director of the restructured team but sold his shares and departed in 1982, ending his direct involvement with the organisation he had helped build into a championship-winning force.
Mayer continued in Indy car racing under the Mayer Motor Racing banner, running the Texaco Star team. In 1986 he returned to Formula One as a co-founder and manager of Haas Lola alongside entrepreneur Carl Haas. The team entered 1980 World Champion Alan Jones and former Ferrari and Renault driver Patrick Tambay. Although results were disappointing, the car itself was widely regarded as one of the more technically promising machines in the field; progress was undermined by the underpowered Ford TEC turbo engine. The acquisition of a title sponsor, Beatrice Foods, brought the team under new management control and led to its withdrawal.
After a year away from the sport Mayer joined Penske as vice-chairman of its motorsports operations, a position from which he presided over the team's dominant run through the 1990s in CART. He moved to a consultancy role with Penske that he maintained until 2007.
Mayer lived in England. He and his wife Sarah (Sally) Bryant, from whom he divorced in 1993, had two children: Tim Mayer, named after his late brother and also involved in motorsport, and Anne. Mayer died on January 30, 2009, from complications arising from Parkinson's disease, with which he had lived for more than a decade.
Teddy Mayer's tenure at McLaren from 1970 to 1982 encompassed two Formula One world championships and a string of Indy car victories, establishing the team as an international force across multiple categories. His ability to attract sponsors and drivers of the highest calibre, together with his legal training and business acumen, shaped the professional structure that McLaren's subsequent owners would inherit and expand upon.