McWhiney was born in Shreveport, Louisiana, and served in the Marine Corps in 1945. He married in 1947. He attended Centenary College on the G.I. Bill and earned an M.A. in history from Louisiana State University, working with Francis Butler Simkins. He received his Ph.D. in history from Columbia University in New York, working with David Herbert Donald.
McWhiney's dissertation dealt with Confederate General Braxton Bragg. McWhiney became a noted specialist on the American Civil War era, as well as southern social and economic history. He coauthored Attack and Die with his doctoral student Perry Jamieson. He published Braxton Bragg and Confederate Defeat, in two volumes, as well as many scholarly and popular articles and reviews. He lectured frequently to both academic and popular audiences.
McWhiney and Forrest McDonald were the authors of the "Celtic Thesis," which holds that most Southerners were of Celtic ancestry (as opposed to Anglo-Saxon), and that all groups he declared to be "Celtic" (Scots-Irish, Irish, Scottish, Welsh and Cornish) were descended from warlike herdsmen, in contrast to the peaceful farmers who predominated in England. They attempted to trace numerous ways in which the Celtic culture shaped social, economic and military behavior. For example, they demonstrated that livestock raising (especially of cattle and hogs) developed a more individualistic, militant society than tilling the soil.
Attack and Die stressed the ferocity of the Celtic warrior tradition. In "Continuity in Celtic Warfare." (1981) McWhiney argues that an analysis of Celtic warfare from 225 BC to 1865 demonstrates cultural continuity. The Celts repeatedly took high risks that resulted in lost battles and lost wars. Celts were not self-disciplined, patient, or tenacious. They fought boldly but recklessly in the battles of Telamon (225 BC), Culloden (1746) and Gettysburg (1863). According to their thesis, the South lost the Civil War because Southerners fought like their Celtic ancestors, who were intensely loyal to their leaders but lacked efficiency, perseverance, and foresight.
In 1993 he argued the fundamental differences between North and South developed during the 18th century, when Celtic migrants first settled in the Old South. Some of the fundamental attributes that caused the Old South to adopt anti-English values and practices were Celtic social organization, language, and means of livelihood. It was supposedly the Celtic values and traditions that set the agrarian South apart from the industrialized civilization developing in the North.
However, McWhiney's theories do not address large-scale Irish immigration to New York, Boston, and other northern cities. They also ignore the degree to which the Southern planter class resembled the English gentry in lineage, religion, and social structure. Furthermore his work avoids mentioning or acknowledging the fact that the largest group of pre-Revolution immigrants to the Southern colonies were English indentured servants who vastly outnumbered the "Celtic" settlers both in numbers and in cultural influence.,
McWhiney taught at numerous institutions including Troy State University, Millsaps College, the University of California, Berkeley, Northwestern University, the University of British Columbia, Wayne State University, the University of Alabama, Texas Christian University, The University of Southern Mississippi, and McMurry University. Over a 44-year career, he trained 19 history Ph.Ds.
Grady McWhiney was deeply concerned about the future of history in the schools, explaining, "history should be accessible." He founded the Grady McWhiney Research Foundation, located in Abilene, Texas.
McWhiney was a former director of the League of the South, but he had broken with the group prior to his death.
As historian C. David Dalton has pointed out, he was "Controversial. Unconventional. Influential. These are words easily applied to one of the South's most prominent scholars, Grady McWhiney. For over three decades his writings have been discussed and debated but never disregarded."