Kretschmer was born in Berlin, where he studied classic and Indo-European philology under Hermann Diels.

His epochal study of pre-Greek elements in ancient Greek was his 1896 Einleitung in die Geschichte der griechischen Sprache (Introduction to the History of the Greek Language).

Comparing Greek place names with their foreign counterparts in ancient Anatolia, he concluded that a non-Greek, Mediterranean culture had preceded the Greeks there, leaving extensive linguistic traces.

The discoveries of the archaeologist Sir Arthur Evans at Knossos, Crete, around 1900 tended to confirm Kretschmer's views.

An adherent of the Neogrammarian school of linguistics, which stressed rigorous comparative methodology, he also contributed to Modern Greek dialectology and furthered the study of German linguistic geography.