Baker was born in Stafford, New York on October 13, 1826. He became a mechanic, moved to Michigan in 1839, returned to New York in 1848, moved to California in 1853, and was a San Francisco vigilante in 1856. He moved to the District of Columbia in 1861.
Baker's exploits are mainly known through his book A History of the Secret Service which he published in 1867 after his fall from grace. During the early months of the Civil War, he spied for General Winfield Scott on Confederate forces in Virginia. Despite numerous scrapes, he returned to Washington, D.C., with information that Scott evidently thought valuable enough to raise him to the rank of captain. As Provost Marshal of Washington, D.C. from September 12, 1862 to November 7, 1863, Baker ran the National Detective Bureau also sometimes known as the "National Detective Police Department." He was appointed colonel of D.C. Cavalry, May 5, 1863. According to Professor Glenn "Although his accomplishments were many, Baker operated with little regard for warrants or the constitutional rights of those he pursued. He is also reported to have employed brutal interrogation techniques in order to obtain information."
Baker owed his appointment largely to Secretary of War Edwin M. Stanton, but suspected the secretary of corruption and was eventually demoted for tapping his telegraph lines and packed off to New York.
Baker was recalled to Washington after the assassination of President Lincoln in 1865. Within two days of his arrival in Washington, Baker's agents in Maryland had made four arrests and had the names of two more conspirators, including the actual presidential assassin John Wilkes Booth. Before the month was out, Booth along with David Herold were found holed up in a barn and Booth was himself shot and killed by Sgt. Boston Corbett. Baker received a generous share of the $100,000 reward offered to the person who apprehended the president's killer. President Andrew Johnson nominated Baker for appointment to the grade of brigadier general of volunteers, April 26, 1865, but the United States Senate never confirmed the appointment. Baker was mustered out of the volunteers on January 15, 1866.
The following year, Baker was sacked from his position as government spymaster. President Johnson accused him of spying on him, a charge Baker admitted in his book which he published in response. He also announced that he had had Booth's diary in his possession which was being suppressed by the Department of War and Secretary Stanton. When the diary was eventually produced, Baker claimed that eighteen vital pages were missing. It was suggested by Otto Eisenschiml in his book, "Why Was Lincoln Murdered?," that these would implicate Stanton in the assassination. However, this notion has been proven as speculation by author Edward Steers Jr. and based on non-reputable sources.
On July 3, 1868, Baker retired to home complaining of soreness from a gun wound during a hunting trip. He had been out drinking with Wally Pollack, his brother-in-law, and came home feeling sick, passing away later that night, reportedly from meningitis.
As it was scarcely eighteen months after his explosive allegations, Lincoln conspiracists have suggested he was killed by the War Department to silence him. Using an atomic absorption spectrophotometer to analyze several hairs from Baker's head, Ray A. Neff, a professor at Indiana State University, determined that Baker was killed by arsenic poisoning rather than meningitis. Baker had been unwittingly consuming the poison for months, mixed into imported beer provided by his wife's brother Wally Pollack. The Lincoln Conspiracy by Balsiger and Sellier in 1977 cites a diary Baker's wife kept which chronicled several dates Pollack brought Baker beer; they correspond to the gradually elevated levels of toxin in the Baker hair samples Neff studied. Wally worked for the War Department, though whether he acted on orders or alone has yet to be determined. Nevertheless, Neff's studies, along with the information chronicled in Baker's diary, set forth an alternate history of the Lincoln assassination, one distinct from the chronology most commonly promulgated by mainstream U.S. historians.
Baker is buried in Forest Hills Cemetery, Philadelphia, Pennsylvania.