Peterson prepped at Los Angeles High School, before moving on to UCLA, where he played the "loose" defensive end position and was a three-year starter.
Peterson was selected by the Dallas Cowboys in the third round (72nd overall) of the 1974 NFL draft, with the intention of converting him to an outside linebacker.
In 1975, he was the fourth linebacker on the depth chart and was used on passing downs, on a team that played in Super Bowl X.
He returned in the eighth game to play against the Denver Broncos, but he reinjured his knee and was placed on the injured reserve list.
In 1981, he started the season on the reserve non-football injured list after coming to training camp with a virus that limited him, but recovered to play in 11 games.