[1][2] His father made a fortune as a chemist and inventor, and upon his death in 1875, left Dyar and the family financially independent.

He had begun to study insects as a young teenager,[1][4] and soon after his graduation from college began publishing scientific papers about them, in particular moths of the family Limacodidae,[1] starting a lifelong interest in entomology.

He joined a course in embryology at the Woods Hole Biological Station in 1893,[5] and subsequently Columbia University where he trained under Henry Fairfield Osborn, and where he was influenced in eugenics.

He was awarded a Master of Arts degree in biology from Columbia University in 1894, with his thesis on the classification of Lepidoptera, and a doctorate in 1895, with his dissertation on airborne bacteria in New York City under the supervision of Theophil Mitchell Prudden.

After his major field collecting trips he began to work more intently as a taxonomist and published extensively on moths and butterflies (Lepidoptera).

Dyar's Law, the biological rule named for him in recognition of his original observations on the geometric progression in head capsule widths during the larval development of Lepidoptera, is a standard approach for identifying the stage of immature insects or to predict the number of molts.

[6] From 1897 until his death he was honorary custodian of Lepidoptera at the U.S. National Museum, Washington, D.C.[6] The position, though unsalaried, had been made possible by Leland Ossian Howard.

[6] Dyar and Frederick Knab were primarily responsible for the taxonomic portions of The Mosquitoes of North and Central America and the West Indies, published, with co-author L. O. Howard, in four volumes from 1912–1917.

[13][14] In 1924, Dyar was commissioned a captain in the Sanitary Department of the U.S. Army Reserve Officers Corps because of his background in the study of mosquitoes.