Ontkean was born and raised in Vancouver, British Columbia, the son of Muriel (née Cooper), an actress, and Leonard Ontkean, a boxer and actor. He was a child actor in Vancouver and he appeared on the Canadian television series Hudson's Bay (1959). His family later relocated to Toronto, where he attended St. Michael's Choir School, Holy Rosary and later, St. Michael's College School.
Ontkean also grew up playing hockey and he earned a hockey scholarship to the University of New Hampshire, a Division I program playing in the ECAC. In his three years on the varsity program, Ontkean scored 63 goals and 111 points in 85 games played. He led the team in goal scoring his junior year with 30 goals, and was second behind fellow Canadian Louis Frigon his senior year.
Ontkean began in Hollywood by guest starring in The Partridge Family in 1971, and he was a television guest player on such shows as Ironside and Longstreet, but his break was in the ABC series The Rookies (1972–1976), in which he played Officer Willie Gillis for the first two seasons.
Ontkean's hockey skill played a large role in his landing the role of Ned Braden in Slap Shot (1977), as he performed all of his on-ice shots himself. In 1979 he appeared in the first episode of Tales of the Unexpected.
Other early movie roles included Necromancy (1972) with Orson Welles; Voices (1979) with Amy Irving; Willie & Phil (1980) with Margot Kidder; The Blood of Others (1984); The Allnighter and Maid to Order (both 1987) (the latter with Ally Sheedy); Clara's Heart (1988) with Whoopi Goldberg, and Bye Bye Blues (1989).
Making Love (1982) is about a married man who discovers his homosexuality. Ontkean was not the director's first choice for the film: Arthur Hiller had previously approached Tom Berenger, Michael Douglas, Harrison Ford, William Hurt and Peter Strauss to play the lead, before finally approaching Ontkean. According to Hiller, the reaction of most actors was to tell him not to even consider them for the role. The film reunited Ontkean with Kate Jackson; the two had previously co-starred together in The Rookies. Many years later, Ontkean tried to prevent clips from the film from being shown in The Celluloid Closet, a 1996 documentary about LGBT characters in film, but he was unsuccessful.
Ontkean appeared as Sheriff Harry S. Truman in David Lynch and Mark Frost's Twin Peaks (1990). He filmed scenes for Twin Peaks: Fire Walk With Me but, like many others from the original TV series, his scenes were deleted from the final film.
As a result of his retirement, Ontkean did not reprise his role of Sheriff Harry S. Truman in the 2017 revival of Twin Peaks.
Ontkean subsequently appeared in many film and television productions including Kids Don't Tell (1985) with JoBeth Williams; The Right of the People (1986); In Defense of a Married Man (1990); In a Child's Name (1991) with Valerie Bertinelli; Legacy of Lies (1992); Rapture and Vendetta II: The New Mafia (both 1993); Swann: A Mystery and The Stepford Husbands (both 1996); Summer of the Monkeys and A Chance of Snow (both 1998) (the latter again with JoBeth Williams); Bear with Me (2000), and Mrs. Ashboro's Cat (2003).
Ontkean had a recurring role on Fox's short-lived series North Shore in 2004, and also appeared in the 2008 comedy TV show Sophie. He also featured in the 2011 film The Descendants, which was his last role before he decided to retire from acting.
He is married to Jamie Smith Jackson, and they reside in Hawaii. Together they had two daughters.