Nadelmann was born in New York City, where he was raised, in a Jewish family; his father was a rabbi. He earned B.A., J.D., and Ph.D. degrees from Harvard University and a master’s degree in international relations from the London School of Economics. He taught politics and public affairs at Princeton University from 1987 to 1994.
While he was at Princeton, Nadelmann lectured and wrote extensively on drug policy, attracting considerable attention with his articles in such periodicals as Science, Foreign Affairs, American Heritage and National Review. He also formed the Princeton Working Group on the Future of Drug Use and Alternatives to Drug Prohibition.
After Barack Obama won the presidential election, Matt Elrod, the director of the drug policy reform group DrugSense, filed an internet petition for Ethan Nadelmann as the new Drug Czar. Although any hopes in getting Nadelmann appointed were downplayed, "this petition will at least encourage President-elect Obama to think twice about his choice of drug czar." Drug Policy Alliance never lobbied for Nadelmann, however once media reports alleged that James Ramstad (R-MN) would be appointed to the post the organization urged people to oppose the appointment due to his opposition to medical marijuana and needle exchange among other things. Seattle's police chief Gil Kerlikowske became the next head of the White House Office of National Drug Control Policy (ONDCP), an appointment that DPA is cautiously optimistic about.
On September 28, 2012, Nadelmann spoke at the Human Rights Foundation’s San Francisco Freedom Forum. He discussed the United States' incarceration rates, which are at 743 people per 100,000 inhabitants, and how America's drug policies are affecting that number.
Nadelmann founded the Lindesmith Center in 1994, a drug policy institute created with the philanthropic support of George Soros. Six years later the Center merged with the Drug Policy Foundation founded by Kevin Zeese and Arnold Trebach. The merger became the Drug Policy Alliance, an advocacy group for drug policies "grounded in science, compassion, health and human rights." As the Executive Director of the Drug Policy Alliance, Nadelmann takes a public health - rather than a criminal justice - approach to the War on Drugs advocating for the application of harm reduction principles.
On December 20, 2012, the Alliance paid for a full-page advertisement in The New York Times to celebrate the legalization of marijuana in Washington and Colorado, signaling "the beginning of the end for the costly and unjust war on drugs." The advertisement thanks numerous politicians, including former president Bill Clinton and congressman Ron Paul, for their efforts to combat the war on drugs.
Nadelmann has referred to the United States' drug policies in Latin America as brutal and prohibitionist. He is an advocate for legalization in Latin America.
Nadelmann has been a strong advocate of less restrictive cannabis laws in the United States including legalizing the use of cannabis for medical purposes, regulating recreational usage, and imposing civil rather than criminal penalties for those who are caught using or possessing small amounts of cannabis.
Overall, Nadelmann is optimistic about the future of drug policies under President Obama, particularly after his December 2012 interview with Barbara Walters. During the interview, Obama expressed that he did not "at this point" support widespread legalization of marijuana, which Nadelmann likens to his previously evolving viewpoint on gay marriage, before publicly announcing his support.