Born to Peter (a heating contractor) and Queenie (a junior high school teacher) Palladino, he is the youngest of three sons. He wanted to be an actor after watching Robert De Niro's performance in the 1980 film Raging Bull when he was 12 years old. He joined a children's repertory company a year later. He and his brother, Chris, performed together in Chris' alternative rock band No More Happy Faces. He had long hair at the time, as he was a big fan of Jon Bon Jovi.

Erik graduated from the all-boy Catholic Archbishop Stepinac High School. This prompted him to then major in theatre at Marymount Manhattan College. He graduated in 1991 earning a Bachelor of Arts degree. He then continued performing with Rock's band until he got his first breakthrough role on the popular American television series ER.

In 2005, he starred in the FX television series Over There as "Sgt. Scream," the leader of a squad of U.S. 3rd Infantry Division soldiers involved the 2003 Invasion of Iraq. The show earned the milestone of being the first entertainment-oriented production featuring a currently ongoing conflict in the United States.

Erik also plays on the World Poker Tour in the Hollywood Home games for the Boys and Girls Clubs of Hollywood charity.