Born Edward Walter Kriaučiūnas in Chicago to Lithuanian immigrant parents, Krause grew up in the Town of Lake section or, as it was once known as, Back of the Yards.

His surname was shortened to Krause by his high school football coach, who could not pronounce Kriaučiūnas (Lithuanian pronunciation: [krɪ.ɐutɕɪˈuːnɐs]).

[1] As acting head football coach at Notre Dame, filling in for an ailing Frank Leahy, Krause was 3–0.

Krause served in the United States Marines during World War II including a 14-month stretch as an air combat intelligence officer in the South Pacific.

In March 1949, he was named athletic director, succeeding Frank Leahy, who stepped down from the role to focus on his post as head football coach.