McDonald was selected by the Maple Leafs as the fourth overall pick in the 1973 NHL Amateur Draft and established himself as an offensive forward with three consecutive 40-goal seasons in Toronto in the mid-1970s.

McDonald is among the most popular players in Flames history and his personality and bushy red moustache made him an iconic figure within the sport.

He served as a stick boy, helping manage equipment, for his father's community team and grew up listening to the famous Foster Hewitt radio broadcasts of Hockey Night in Canada.

[7] He began playing organized hockey at the age of six and, despite both having full-time commitments, his parents drove him and Lynn to Hanna for their practices and games.

When McDonald returned to the ice sheet he put on his Winwell style helmet that he had worn as a Medicine Hat Tiger, which he wore for the rest of his career.

Atlanta Flames general manager Cliff Fletcher sought to take advantage of the Maple Leafs' early disappointment in McDonald and agreed in principle to a trade for the young forward in exchange for Curt Bennett.

The patience the Maple Leafs had shown McDonald in his first two seasons was rewarded in 1975–76 when he rediscovered his offensive touch, scoring 37 goals and adding 56 assists.

Playing despite breaking both his wrist and nose during the series,[23] McDonald scored the overtime winning goal that eliminated the Islanders and allowed the Maple Leafs to advance to the league semi-finals for the first time in 11 years.

[25] Punch Imlach was named Toronto general manager prior to the 1979–80 season and immediately clashed with team captain Darryl Sittler.

[32] The Rockies disputed that any such negotiations had taken place and Ballard quickly apologized for the news story after Colorado threatened to file tampering charges against the Maple Leafs' owner.

[7] Stating that his team needed to add character and leadership, Cliff Fletcher finally completed a trade for McDonald seven years after his first attempt.

McDonald was acquired by the Calgary Flames, along with a draft pick, in exchange for Bob MacMillan and Don Lever on November 25, 1981.

[37] McDonald also felt the pressure of having to replace two popular ex-Flames in MacMillan and Lever while also working to overcome a separated shoulder he suffered earlier in the year with the Rockies.

[50] McDonald became the 21st player in NHL history to score 400 career goals, reaching the mark in a 7–4 loss in Los Angeles on December 21, 1983.

[10][53] As the 1985–86 season approached, McDonald endured questions about whether he was reaching the point where age and injuries meant he could no longer be an effective NHL player.

[55] He succeeded, and scored 28 goals and 71 points in the process,[10] despite dislocating his thumb in the preseason and suffering minor knee and hip injuries during the course of the year.

[60] The victory over their provincial rivals also touched off a celebration amongst the fans, of which over 20,000 greeted the team with wild cheering when their plane landed at Calgary International Airport.

McDonald received the pass then shot the puck over Montreal goaltender Patrick Roy's glove to give the Flames a 2–1 lead.

[76] He received no such role, and two months after the hiring of Craig Button as executive vice president and general manager of the Flames, McDonald announced he was leaving the organization.

[78] Ken King, newly hired president of the Flames, lured McDonald back into the organization a year later by naming him an executive assistant to hockey operations.

The organization entered a transitional phase, as many players used to the warm weather and relaxed atmosphere of Atlanta were unable or unwilling to adapt to the higher expectations fans in Calgary placed on them.

[34] McDonald's arrival in Calgary was considered a turning point for the organization, one where his personality, demeanor and on-ice play came to define the Flames in the 1980s.

[91] Poile argued that it signalled the true beginning of the team in its new market: "The trade for Lanny McDonald was the start of the Calgary Flames franchise.

He added that the personal and professional disappointments McDonald endured in Toronto and Colorado resulted in his gaining a greater appreciation of both the game and himself.

He came into the NHL at a time when the battle with the rival WHA for talent led to rookies signing for far more money than the previous generation of players commanded.

[95] The Flames made McDonald the first player in franchise history to have his jersey retired when they raised his number 9 to the rafters of the Olympic Saddledome in a ceremony on March 17, 1990.

[98] McDonald's image endured well into retirement; in 2008, he was the only athlete named in a list of Alberta's ten greatest citizens compiled by the Calgary Herald.

Knowing that the Maple Leafs did not allow players to maintain beards at the time, he settled on what he described as a "normal moustache" once he returned to Toronto.

In 1988, McDonald's contributions to the Special Olympics as a coach and co-chairman of the organization's fundraising efforts, as well as his work with the Alberta Children's Miracle Network Hospitals, were recognized by the NHL as he was named the inaugural recipient of the King Clancy Memorial Trophy.

[118] On February 4, 2024, while returning home from the 2024 NHL All-Star festivities, McDonald suffered a heart attack and went into cardiac arrest at the Calgary International Airport.