Buell was raised on a farm in Gibsonia, Pennsylvania, and thus learned to work on machinery at a young age.
In his teen years, Buell began motorcycling, his first ride was an Italian Parilla 90cc moped.
He later attended the University of Pittsburgh.
Buell raced motocross before becoming interested in road racing in his early 20s. He became an avid part-time road racer and did his racing with a Ducati in the AMA 'Superbike' class and a Yamaha TZ750 in 'Formula One', despite the aging race program at Yamaha.
During this period, Buell was employed as a motorcycle mechanic during the day and engineering student taking night classes at the University of Pittsburgh.
After receiving his degree in engineering in 1979, Buell landed a job at Harley-Davidson after he flew himself to Milwaukee, WI to get an interview and "beat my way in the door," as Buell put it.
While at Harley, he was involved with concept motorcycles, Porsche-designed "Nova" V-four program, and was responsible for considerable stability and refinements to the chassis design of the FXR series of cruisers, noted for their rubber-mounted engines.
Buell first heard of the small, privately held general purpose engine maker Barton (based in Great Britain) in 1981 - he bought their limited production racer, powered by a water-cooled 750 cc Square Four two-stroke engine. Unfortunately, the bike was very poorly manufactured and was constructed from cheap materials and the engine was plagued with issues however, with Buell's engineering background, he felt that he could refine the weak points using his own designs and improve the engine. Slowly, as parts failed he re-engineered them to increase reliability, and in many cases saw performance gains with his modifications. The chassis was a different story. Buell deemed it a lost cause from the beginning and designed his own chassis from the ground up. Nonetheless, the engine would often have failures before even completing a race.
Buell first raced a prototype of his bike, still using the mostly stock Barton engine, in summer of 1982 at AMA National on the Pocono Speedway. He dubbed it the RW750 (RW standing for Road Warrior). During testing at Talladega, AL, the RW750 was clocked at a top speed of 178 mph (286 km/h). He raced in the 500 cc-dominated Formula One class (the Barton engine was designed prior to 1978 and was grandfathered into this class by AMA rules). He found some success at the local club levels despite the grossly overpowered, unrefined engine.
In 1982, Barton was shutting down and Buell was given the option to purchase the entire stock of spare engines and parts, all drawings and the rights to produce and sell the engine. Buell did so, but the shipment was delayed such that he missed the opportunity to make full use of this new equipment and knowledge for the upcoming 1983 racing season, which delayed the development of the engine somewhat.
With the stunted development, Buell's inquiry with his employer to gain engineering and financial support was declined due to continuing reliability problems with mostly stock Barton engine. It was at this point that Buell had to quit his job at Harley-Davidson (parting amicably) in order to devote more time to the development of his racing effort.
By late 1984, Yamaha TZs were scarce (Yamaha had ceased production of the TZ series) and the competing Hondas were selling for around $30,000. Buell offered his RW750s under the 'Buell Motor Company' marque for $15,900 to much lauding by the press. The American Machinist's Union Racing Team bought, tested and raced the first publicly sold RW750 (commonly known as 'RW750 number 2'), and gave it glowing marks.
Despite all of this, his timing couldn’t have been worse – the AMA announced in the spring of 1985 that the Superbike class would supplant Formula One as the premier road racing class for the 1986 racing season and the Formula One class would be discontinued, leaving Buell with no market for his creation.
Despite this staggering setback, Buell forged ahead and designed his first entry into the sportbike market, the RR1000. Using his connections at Harley-Davidson, he acquired a sizeable cache of unused XR1000 racing engines, the powerplant of a model he had ridden to a podium finish at the 1983 Road America Battle of the Twins National, so he had confidence in this engine's potential in the sport market. Around this powerhouse, he designed a stiff, extremely light chassis that incorporated the unconventional rubber-mounting system known as "the Uniplanar" that became a patented engineering trademark of Buell sport bikes. The wrap-around fairing design had lower aerodynamic drag than all but a small handful of even current 21st century sportbikes.
Buell's design incorporated the engine as a fully stressed member of the frame. Capping the engineering firsts in this design was Buell's use of a horizontally mounted suspension located beneath the motor utilizing a shock that operated in reverse of the conventional compression-rebound design. Fifty RR1000 models were produced during 1987-1988 before the supply of XR1000 engines was depleted.
Buell saw the newly developed 1203 cc Harley-Davidson Evolution engine being used in their 'Sportster' model line as solid base platform to further tune the performance and handling qualities of his bikes. The RR1200 model was introduced during 1988 with a redesigned chassis to incorporate a modified version of this very different engine design. Through 1989, 65 were produced for sale.
In 1989, Buell introduced the RS1200 model, a two-seat version of the RR1200 marketed to riders who demanded both world-class performance and desired (at least occasional) passenger capacity. 105 of these then-unusual models were produced through 1990.
In 1991, Buell incorporated a five-speed transmission mated to the 1203 cc engine. Buell responded to Harley's revised engine mounting points by further improving an already staggeringly innovative design that was the RS chassis. Stainless steel braided brake lines and a six-piston front brake caliper. Later that same year, Buell introduced a single-seat version of the RS1200 model, dubbed the RSS1200, it won enthusiastic approval of the industry press for its lean, clean lines. Combined production of RSS and RS models totalled 325 through 1993.
In 1987, Devin Battley smuggled Erik Buell onto a cruise ship for the Harley-Davidson annual dealer's meeting. Battley told Harley-Davidson then-CEO, Vaughn Beals, that Buell could give the company a performance image with no risk to Harley. They set up a table for Buell to speak with dealers and by the end of the cruise he had deposits and orders for 25 motorcycles. Attendees such as Bill Bartels, Don Tilley, Devin Battley and Frank Ulicki (all ex-racers) went on to become some of Buells most successful dealers.
In the 1990s, Buell reformed his production house as the 'Buell Motorcycle Company' in which Harley-Davidson invested a 51 percent interest from the company's onset. Harley-Davidson bought complete control of Buell Motorcycle in 2003, and distributed all Buell motorcycles through selected Harley-Davidson dealerships. Erik Buell remained responsible for the engineering and design of all Buell motorcycles.
Buell led the company to create some of the most innovative, usable sport bikes to date under the XB series of Buell Motorcycles. Using inventions like a twin spar hollow aluminum frame to house the fuel and create chassis rigidity, a hollow swing arm to house the oil, and an underslung exhaust pipe, he was able to keep the center of gravity low for optimum handling. During this time, still using the 45 degree V-twin Harley-Davidson engine design, albeit re-worked to produce 30% more horsepower than the standard HD Sportster engine. For the 2008 model year, Buell introduced a new water cooled, 1125cc, 72 degree V-twin engine developed in cooperation with Rotax for the Buell 1125R and 1125CR(2009) producing 146 bhp.
On October 15, 2009, amid the economic crisis, Harley-Davidson announced that all production of Buell motorcycles would cease on October 30, 2009.
In November 2009, shortly after being dropped by Harley-Davidson, Buell launched Erik Buell Racing. Originally continuing by only producing and supporting race-only versions of the Buell 1125R. His most recent creations; now unrestricted by Harley-Davidson, the EBR 1190RS, the 1190RX and the 1190SX. The 1190 models are powered by the similar water cooled, 72 degree V-twin that powered the Buell 1125 however, the motors have been re-engineered with an increase in cc's to 1190, with a substantial power boost to 185 hp and 102 ft/lbs. of torque.
During July 2013 the Wall Street Journal reported Hero MotoCorp, a maker of high-end street motorcycles bought a 49.2% stake in Erik Buell Racing LLC, for $25 million. The remaining stake is held by Erik Buell, the founding chairman and chief executive of the East Troy, Wisconsin-based company.
In 2002 Buell was inducted into the AMA Motorcycle Hall of Fame.
The very first (prototype) RW750 eventually found its fate as pieces in Erik's barn workshop, as is common for development machines. In 1998 a group of long-time Buell employees and supporters worked in secret to reassemble this bike using as many original pieces as they could find, hand crafting any missing pieces to bring it as close as possible to its 1983 racing condition. A new Buell 850 cc engine out of a D-sports racing car was used as the powerplant. The rebuilt bike was given to Erik Buell at the 1998 Race of Champions event, as a complete surprise to him.
The September 2011 issue of Motorcyclist magazine named Erik Buell the 2011 Motorcyclist Of The Year.