Peter Barton Wilson was born on August 23, 1933, in Lake Forest, Illinois, a suburb north of Chicago. His parents were James Boone Wilson and Margaret (Callaghan) Wilson. His father sold college fraternity jewelry to work his way through University of Illinois, and later became a successful advertising executive. The Wilson family settled in St. Louis, Missouri when Pete was in elementary school. He then attended the private, non-sectarian preparatory middle school John Burroughs (grades 7–9) in Ladue, and then St. Louis Country Day School, an exclusive private high school, where he won an award in his senior year for combined scholarship, athletics, and citizenship. In the fall of 1951, Pete Wilson enrolled at Yale University in New Haven, Connecticut, where he received a United States Navy Reserve Officers' Training Corps (ROTC) scholarship, majored in English, and earned his Bachelor of Arts degree. In his junior year he elected to join the Marine Corps upon his graduation.
After graduating from Yale, Wilson served for three years in the United States Marine Corps as an infantry officer, eventually becoming a platoon leader. Upon completion of his Marine Corps service, Wilson earned a Juris Doctor degree from the University of California, Berkeley School of Law.
In 1962, while working as an Advance Man for the Republican gubernatorial candidate Richard M. Nixon, Wilson got to know Herb Klein, one of Nixon's top aides. Klein suggested that Wilson might do well in Southern California politics, so in 1963, Wilson moved to San Diego.
After passing the bar exam, Wilson began his practice as a criminal defense attorney in San Diego, but he found such work to be low-paying and personally repugnant. He later commented to the Los Angeles Times, "I realized I couldn't be a criminal defense lawyer – because most of the people who do come to you are guilty." Wilson switched to a more conventional law practice and continued his activity in local politics, working for Barry Goldwater's unsuccessful presidential campaign in 1964. Wilson's liking for politics and managing the day-to-day details of the political process was growing. He put in long hours for the Goldwater campaign, earning the friendship of local Republican boosters so necessary for a political career, and in 1966, at the age of thirty-three, he ran for, and won a seat in the California State Assembly, succeeding Clair Burgener.
Wilson was re-elected to the Assembly in 1968 and 1970, and in 1971 was elected mayor of San Diego.