From 1871 he studied music, history, classical philology and philosophy in Berlin, Bonn and Strasbourg.

In the winter semester of 1923–24 Natorp conducted an intensive exchange of ideas with Martin Heidegger, who had been called to Marburg and whose work on Duns Scotus Natorp had read very early on.

He conducted a correspondence with Johannes Brahms, who dissuaded him from becoming a professional composer.

He was an influence on the early work of Hans-Georg Gadamer and had a profound effect on the thought of Edmund Husserl, the "father" of phenomenology.

His students included the philosopher and historian Ernst Cassirer, the theologian Karl Barth and the author of Doctor Zhivago, Boris Pasternak.