Peter began his career as a teacher in Vancouver in 1941, and received the degree of Doctor of Education from Washington State University in Pullman in 1963.

[1] In 1966, Peter moved to California, where he became an Associate Professor of Education, Director of the Evelyn Frieden Centre for Prescriptive Teaching, and Coordinator of Programs for Emotionally Disturbed Children at the University of Southern California (USC) in Los Angeles.

He became widely known in 1969 upon the publication of The Peter Principle – co-authored by Raymond Hull, also from Vancouver – in which he states: "In a hierarchy every employee tends to rise to his level of incompetence... [I]n time every post tends to be occupied by an employee who is incompetent to carry out its duties... Work is accomplished by those employees who have not yet reached their level of incompetence."

"[2] From 1985 to his death in 1990, Peter attended and was involved in management of the Kinetic Sculpture Race in Humboldt County, California.

At age 70, Peter died of complications from a stroke at his home in Palos Verdes Estates, California.