Cain was born into an Irish Catholic family in Annapolis, Maryland. The son of a prominent teacher and an opera singer, he had inherited his love for music from his mother, but his high hopes of starting a career as a singer himself were thwarted when she told him that his voice was not good enough. After graduating from college in 1917 Cain enlisted in the army and spent the final years of World War I in France writing for an army magazine. Back in the States he continued working as a journalist but later turned to screenplays and finally to fiction.

He made use of his love of music and of the opera in particular in at least two of his novels, Serenade (about an American opera singer who loses his voice and who, after spending part of his life south of the border, re-enters the States illegally with a Mexican prostitute in tow) and Mildred Pierce (where, as part of the subplot, the only daughter of a successful businesswoman trains as a singer).

Critics have pointed out that there is a basic formula pervading most of Cain's fiction. Almost always, with the notable exception of Mildred Pierce, a man falls for a woman - the femme fatale (see also stock character) - ,becomes involved in criminal activity with the woman, and is eventually betrayed by her. Invariably, Cain's novels are about sex, crime and violence.

In 1944 Cain married film actress Aileen Pringle, but the marriage was a tempestuous union and dissolved in a bitter divorce two years later.

Cain continued writing up to his death. However, the many novels he published from the late 1940s onward never rivalled his earlier successes. He died an alcoholic, aged 85.