Along with Guy Anderson, Kenneth Callahan, Morris Graves, and William Cumming, Tobey was a founder of the Northwest School.

Senior in age and experience, he had a strong influence on the others; friend and mentor, Tobey shared their interest in philosophy and Eastern religions.

When his ex-wife found Tobey's address, she sent him a box of his clothes topped with a copy of Rudyard Kipling's The Light That Failed.

The beginning of his lifelong travels occurred in 1925 when he left for Europe, settling in Paris where Tobey met Gertrude Stein.

Upon returning to Seattle in 1927, Tobey shared a studio in a house near the Cornish School (with which he was intermittently associated)[8] with the teenage artist, Robert Bruce Inverarity, who was 20 years younger.

Inspired by Inverarity's high-school project, Tobey developed interest in three-dimensional form and carved some 100 pieces of soap sculpture.

Japanese authorities confiscated and destroyed an edition of 31 drawings on wet paper that Tobey had brought with him from England to be published in Japan.

Tobey's first solo exhibition at the Seattle Art Museum occurred in 1935; he also traveled to New York, Washington, D.C., Alberta, Canada, as well as Haifa for a Baháʼí pilgrimage.

In June 1939, when Tobey attended a Baháʼí summer program and overstayed his allotted vacation time, Inverarity dropped him from the Works Progress Administration (WPA) project.

He also spent three months as guest critic of graduate students' work at Yale University on the invitation of Josef Albers, and had his first retrospective show at the California Palace of the Legion of Honor in San Francisco.

Acknowledging "academic responsibility," Hallsten enrolled in graduate school at the University of Washington's department of Scandinavian languages and literature in the early 1950s and, after receiving his master's degree,[11] Tobey began referring to him by the honorific, Professor.

[12] On September 28, 1953, Life magazine published an article on Tobey, Guy Anderson, Kenneth Callahan, and Morris Graves entitled, "Mystic Painters of the Northwest," which placed them in the national limelight.

[15] In 1960, Tobey participated in the Association of Visual Artists Vienna Secession, and in the following year, he became the first American painter to exhibit at the Pavillon de Marsan in Paris.

[16] In 2017 (from 6 May to 17 September), an important retrospective exhibition of Tobey's mature work was mounted in Venice, Italy, sponsored by the Peggy Guggenheim Collection, organized by the Addison Gallery of American Art Philips Academy of Andover, Massachusetts, and curated by Debra Bricker Balken.

This method, in turn, gave rise to the type of "all-over" painting style made most famous by Jackson Pollock and later painters.

When unveiling his white writing work at the Willard Gallery, where a lot of the future Abstract Expressionists were then exhibiting, Tobey did not want to confuse people as he was based in Seattle with strong ties to Asian art.

This method, a fusion of the spirit of Chinese writing with morphic characters rooted in twentieth-century painting, derives from Tobey's intensely personalized vision.

Pollock was never really concerned with diffused light, but he was very interested in Tobey's idea of covering the entire canvas with marks up to and including its edges, something not done previously in American art.

There have been at least four posthumous individual exhibitions of Tobey's work: National Gallery of Art, Washington, D.C., USA, 1984; Museum Folkwang, Essen, Germany, 1989; Galerie Beyeler, Basel, Switzerland, 1990; and Museo Nacional Centro de Arte Reina Sofía, Madrid, Spain, November 11, 1997 – January 12, 1998 where the exhibition brought together about 130 works from some 56 different collections, covering the years from 1924 to 1975.