Olson was born in Saskatoon, Saskatchewan, and was raised by his grandparents until the age of 6, as his mother had contracted tuberculosis.
Along with Janet Astington, Alison Gopnik, and Lynd Forguson, Olson conducted pioneering work on the origins of the concept of belief and intention that led to the publication of the 1988 volume Developing Theories of Mind.
Olson's work, along with that of Emilia Ferreiro and others, has helped to shift the understanding of reading and writing acquisition from skills to be acquired into concepts to be understood.
When he began his studies, psychology made little allowance for language, let alone writing, as a cognitive resource in the mental lives of persons.
In this context Olson advanced the revolutionary argument that, far from being an instrument for the convenient transmission of speech, writing is responsible in large part for shifting the speaker's attention from the ordinary pragmatic functions of language to the phonological, semantic, and syntactic properties of the language itself.
He vastly expanded the theory into the book ‘’The World on Paper: The Conceptual and Cognitive Implications of Writing and Reading" (CUP, 2004).
Olson was long concerned with the implications of the advances in psychological theory for educational theory and practice an interest sponsored by Jerome Bruner's 1960 book, "The Process of Education"[7] Olson examined the implications of the so-called "cognitive revolution" of the 1960s, a revolution led by the work of Noam Chomsky, Jerome Bruner, George Miller, Roger Brown, and others in a book entitled ‘’Jerome Bruner: The Cognitive Revolution in Educational Theory."
Curriculum designer and school reformer, Cynthia McCallister, has collaborated with Olson to integrate his theories of literacy and responsibility into a pedagogical program called Learning Cultures, initially implemented in a number of schools in New York City.