Williamson was born in Pathhead near Kirkcaldy, Fife, and raised in Edinburgh, where he trained to be a master chemist. He moved to London in 1868, where he was an apprentice to a pharmacist and to Eastry, Kent in 1877, where he bought his own pharmacy and got married. He was also a keen amateur photographer who sold photographic apparatus and chemical supplies in his shop and became an agent for Kodak.
In 1886, he moved his chemist's and photographic business to 144 Church Road, Hove, where he took up residence with his family, and formed friendships with fellow pioneers Esmé Collings, William Friese-Greene and George Albert Smith, among others, for whom he supplied chemicals and processed films,. The property, previously owned by the photographer S. Grey of Well & Grey, was later renumbered 156 Church Road and currently bears a commemorative plaque to Williamson's achievements unveiled as part of the centenary of cinema celebrations in 1996.
Williamson, who initially purchased and adapted an apparatus for local showings of Smith's films, was, with assistance from the engineer Alfred Darling, able to create his own home-made filming apparatus and begin making films, including the actuality Devil's Dyke Fun Fair, in time for inclusion in the Hove Camera Club's annual exhibition in November 1896, and again in November 1897. At the same time he introduced x-ray photography to the region.
In 1898, he moved his chemist's and photographic business to 55 Western Road, Hove, where he and his family took up residence, and issued his first catalog, which was expanded that year to include, among others, trick film The Clown Barber and comedy Washing the Sweep. These were latter distributed by the Warwick Trading Company under the directorship of Charles Urban.
Williamson's Popular Entertainments, a Saturday night showing of his films, ran for five weeks from January to February 1900 and for a further four weeks from November to December at the Hove Town Hall. The latter series featured the premiere of Williamson's innovative Attack on a China Mission, which included a four shots that developed the narrative and a reverse-angle cut giving the audience an alternate perspective, as well as winter sports scenes filmed in Switzerland by mountaineer and traveler Aubrey Le Blond, described as the first identifiable female filmmaker.
Williamson, as shown by the 1901 census in which he is described as a chemist & druggist but engaged in photography only, had entered a period of dedicated film-making during which he produced trick film The Big Swallow, with its innovative use of extreme close-up, as well as dramas Fire! and Stop Thief!, with their use of action continuity across multiple shots which established the basic grammar of film. The following year these films became available in the U.S. where they are said to have influenced Edwin Porter's Life of an American Fireman and The Great Train Robbery (both 1903).
In 1902, he moved his business, now named the Williamson Kinematographic Company, to a new location at Cambridge Grove off Wilbury Villas, Hove, where he and his family took up residence at Rose Cottage and a glasshouse film studio and a photographic atelier, designed by W.B. Sheppard, were constructed to house production and processing of such important works as, The Little Match Seller as well as The Soldier's Return and A Reservist, Before the War, and After the War, which pioneered the use of film to promote social issues, prefiguring the genre of Social Realism. That summer he also filmed the procession and rehearsal procession for the coronation of King Edward VII.
Williamson Kinematographic Company began a period of expansion in 1907 opening new offices in London and in New York, under Williamson's son Alan. Williamson himself, like fellow pioneer Robert W. Paul, had become disillusioned with the increasingly industrialized nature of the business and left production first to Jack Chart and later to David Aylott, while he concentrated on film processing and distribution, as well as working with his son Colin, an engineer, on a new venture manufacturing and selling equipment. The following year, as part of this new venture, he invented a device which allowed exhibitors to make their own intertitles. Williamson, along with Charles Urban and other filmmakers, also attended the 1909 European Convention of Film Producers and Publishers in Paris, intended to combat the threat from the foundation of the Motion Picture Patents Company in the U.S., shortly before shutting down the film production and exhibition arms of his business.
In 1910, following the production of his final film, The History of a Butterfly: A Romance of Insect Life, announced as the first of an unrealized series of innovative informational films on science and nature subjects, Williamson and his family moved to London, and his premises at Cambridge Grove were sold Charles Urban's Natural Color Kinematograph Company. That year he also patented a projector which inserted title slides into projected films. Williamson briefly returned to production in 1913 with a newsreel service which closed down shortly after the outbreak of World War I.
By this time Williamson Kinematographic Company assets included a processing plant in Barnet and a factory in Willesden, where the famous Williamson's 'Topical' cameras along with a variety of other apparatus widely used in the British film industry of the time were manufactured. During the war the company pioneered the development of aerial photography, producing gun-mounted reconnaissance cameras to photograph aerial battles. It also created an innovative photogrammetry camera for scientific and military use and a photo-finish camera for horse-racing.
On 18 August 1933, Williamson died at his home in Richmond, Surrey of a heart attack.
The Williamson Kinematograph Company continued to make a range of cameras, processing and printing equipment and continued its pioneering work in aerial reconnaissance during the World War II.
The pioneering film work of James Williamson, as well as Esme Collings and George Albert Smith, was commemorated in the 1966 BBC Television programme It Began in Brighton, produced by Melvyn Bragg and directed by Tristram Powell, and in the 1968 Brighton Festival.
In 1996, as part of the celebration of the centenary of film, the work of Williamson and the other Brighton pioneers was commemorated by the unveiling of plaques, including one on Williamson's former premises in Church Street, an exhibition held at the University of Brighton Gallery and Hove Museum and the publication of Hove Pioneers and the Arrival of Cinema by John Barnes, Ine van Dooren and Frank Gray.