He was born as Stanislaus Pascal Franchot Tone in Niagara Falls, New York, the youngest son of Dr. Frank Jerome Tone, the wealthy president of the Carborundum Company, and his socially-prominent wife, Gertrude Van Vrancken Franchot. His maternal great-grandfather was congressman Richard Franchot. Tone was a distant relative of Wolfe Tone: his great-great-great-great-grandfather John was a first cousin of Peter Tone, whose eldest son was Wolfe Tone. Tone was of French Canadian, Irish, Englishand Basque ancestry.
Tone attended The Hill School in Pottstown, Pennsylvania and Cornell University, where he was President of the drama club and was elected to the Sphinx Head Society. He also joined Alpha Delta Phi fraternity. He gave up the family business to pursue an acting career in the theatre. In 1920 he helped to launch the Buffalo Players, a little theater. After graduating, he moved to Greenwich Village, New York, and got his first major Broadway role in the 1929 Katharine Cornell production of The Age of Innocence.
The following year, he joined the Theatre Guild and played Curly in their production of Green Grow the Lilacs (later to become the famous musical Oklahoma!). He later became a founding member of the famed Group Theatre, together with Harold Clurman, Cheryl Crawford,Lee Strasberg, Stella Adler, Clifford Odets, and others, many of whom had worked with the Theatre Guild. Strasberg had been a castmate of Tone's in Green Grow the Lilacs. These were intense and productive years for him: among the productions of the Group he acted in were 1931 (1931) and Success Story (1932). The same year, however, Tone was the first of the Group to turn his back on the theatre and go to Hollywood when MGM offered him a film contract. In his memoir on the Group Theatre, The Fervent Years, Harold Clurman recalls Tone as the most confrontational and egocentric of the group in the beginning. Nevertheless, he always considered cinema far inferior to the theatre and recalled his stage years with longing. He often sent financial support to the Group Theatre, which often needed it. He eventually returned to the stage from time to time after the 1940s.
Tone summered at Pine Brook Country Club, located in the countryside of Nichols, Connecticut, which became the Group Theatre summer rehearsal headquarters during the 1930s.
Tone's screen debut was in the 1932 movie The Wiser Sex. He achieved fame in 1933, when he made seven movies that year, including Today We Live, written by William Faulkner, Bombshell, with Jean Harlow (with whom he co-starred in three other movies), and the smash hit Dancing Lady, again with then-wife Joan Crawford and Clark Gable. In 1935, he starred in Mutiny on the Bounty (for which he was nominated for the Academy Award for Best Actor), The Lives of a Bengal Lancer and Dangerous opposite Bette Davis.
Tone worked steadily through the 1940s, but he often played second leads or love interests in films that focused on a major female star. Frequently typecast as the wealthy cafe-society playboy, he notably played against type in films like Five Graves to Cairo, a World War II espionage story directed by Billy Wilder, and Phantom Lady, a film noir thriller.
In 1949 he produced and starred in The Man on the Eiffel Tower, a troubled production whose reputation has benefited from restorations in the 2000s that have coincided with theatrical showings and vastly improved DVD releases. Tone's tour de force role as a manic depressive sociopath included performing many of his own stunts on the Paris landmark.
In the 1950s, facing subtle blacklisting in Hollywood, he found parts in New York-based live television, including the original production of Twelve Angry Men. He also returned to Broadway, notably appearing in A Moon for the Misbegotten with Wendy Hiller in 1957. Also that year he co-produced, co-directed, and starred in an adaptation of Chekhov's Uncle Vanya, which was filmed concurrently with an off-Broadway revival.
In the early 1960s, Tone returned to Hollywood and, appearing aged beyond his years, essayed many showcase character roles on popular TV dramas like Bonanza, Wagon Train,The Twilight Zone, and The Alfred Hitchcock Hour. He also co-starred in the Ben Casey medical series from 1965 to 1966 as Casey's supervisor, Dr. Daniel Niles Freeland.
On film, he received acclaim as the charismatic, dying president in Otto Preminger's 1962 film version of Advise & Consent. His final movie appearances were cameos in Preminger's 1965 film In Harm's Way (in which he portrayed Admiral Husband E. Kimmel) and Nobody Runs Forever (1968).
In 1935, Tone married actress Joan Crawford; they were divorced in 1939. They made seven films together: Today We Live (1933), Dancing Lady (1933), Sadie McKee (1934), No More Ladies (1935), The Gorgeous Hussy (1936), Love On The Run (1936) and The Bride Wore Red (1937).
In 1951, Tone's relationship with actress Barbara Payton made headlines when he suffered numerous facial injuries and fell into a coma for 18 hours following a fistfight with actor Tom Neal, a rival for Payton's attention. Plastic surgery nearly restored his broken nose and cheek, and Tone subsequently married Payton, divorcing her in 1952 after obtaining incriminating photographs proving she had continued her relationship with Neal.
He married and divorced two other times:
- Fashion model-turned-actress Jean Wallace (1941–48), with whom he had two sons and who appeared with Tone in both Jigsaw and The Man on the Eiffel Tower
- Actress Dolores Dorn (1956–59), with whom he appeared in Uncle Vanya.