Born in Te Awamutu, New Zealand, Finn went to Sacred Heart College, a Catholic boarding school in Auckland, on a scholarship. In 1971 he went on to study Philosophy and Politics for a Bachelor of Arts degree at the Auckland University. The music practice room 129 (later featured in one of the Split Enz hits) appealed to him, where he jammed with friends Mike Chunn, Robert Gillies, Philip Judd and Noel Crombie. Music soon became more important to Brian than his studies and in mid-1972 he quit university.

A few months later, Phil and Tim (beginning to use his middle name as a stage name) formed a group called Split Ends (renamed Split Enz on the first trip to Australia a year later). The music style is best described as eclectic and wildly original, incorporating influences from art rock, vaudeville, swing, punk, rock and pop. Between 1972 and 1977 Tim shared leader duties with Phil; when the latter left the band for good, Tim's younger brother Neil Finn joined.

In 1983, while Split Enz was taking a break, Tim recorded his debut solo album, Escapade, which met with huge commercial success in Australia and New Zealand. His success and his love affair with renowned actress Greta Scacchi, whom he had met on the set of independent film The Coca-Cola Kid made him take the decision to leave Split Enz for a solo career in June 1984. In early 1985 Tim moved to London and released the second album Big Canoe which failed to repeat the success of its predecessor.

In late 1989 he was back living in Melbourne recording his eponymous third album for Capitol Records. He got together with his younger brother Neil to collaborate on a Finn Brothers record. Instead, Tim became a member of Crowded House, the group Neil had formed after Split Enz and appears on that band's third album Woodface. They later realised that Crowded House was not built to support two leading personalities and parted ways by mutual agreement and Tim continued with his solo career (see discography below).

The collaborative effort was repeated in 1995, and a low key album titled Finn was released by the brothers (see Finn Brothers), who toured Europe, Australia and the USA to support it. In 2004, the brothers released their second album together, Everyone is Here. The album was originally to be produced by Tony Visconti but the final release shows most production credits going to long-time Finn producer Mitchell Froom.

Also in 1995, Finn collaborated with Andy White and Liam O'Maonlai, forming the band ALT (the name being the initial letters of their names). ALT toured in the UK and Australia and released the album Altitude.

Finn also contributed a song to the soundtrack of The Chronicles of Narnia: The Lion, the Witch and the Wardrobe entitled Winter Light.

Both Tim & Neil Finn were made OBE for services to New Zealand music in the 1993 Queen's Birthday Honours List.

June 5th was proclaimed Tim Finn Day by the mayor of Pittsburgh during Tim's US tour in 2000.