Born in Omaha, Nebraska, Shanahan received a Bachelor of Arts degree from the University of Notre Dame in 1956 and a Bachelor of Laws from Georgetown University Law Center in 1959.

He was in private practice in Ogallala, Nebraska from 1959 to 1983.

Shanahan was a judge on the Nebraska Supreme Court, to which he was appointed March 24, 1983, to fill a vacancy created by the death of Judge Lawrence M. Clinton.

On August 6, 1993, Shanahan was nominated by President Bill Clinton to a new seat on the United States District Court for the District of Nebraska created by 104 Stat.

He assumed senior status on May 5, 2004 but stopped hearing cases on February 1, 2007.