In 1808 he came under the influence of James Hews Bransby, who prepared him for entrance (September 1810) at Manchester College, then at York, under Charles Wellbeloved and John Kenrick.
His review (1834) of John Henry Newman's Arians of the Fourth Century brought him into correspondence with Thomas Turton.
His theological position was conservative, but he was the first in his denomination to bring to his classroom the processes and results of German critical research.
In breadth of treatment and in depth of original research Wallace's work is inferior to that of Thomas Rees (1777–1864), but he deploys a careful array of authorities.
He covers more ground than previous writers giving lives and biographies, continental and English, extending from the Protestant Reformation to the early eighteenth century.
He was the son of Robert Wallace (d. 17 June 1830) by his wife Phoebe (d.11 March 1837), His father was a pawnbroker; his grandfather was a Dumfriesshire farmer.