Mosse was born in Berlin, where his maternal grandfather, Rudolf Mosse, was the founder of one of Germany's leading newspaper concerns and publisher of Berliner Tageblatt. His father, Hans Lachmann Mosse, commissioned the architect Erich Mendelsohn to redesign the Mossehaus where the Tageblatt was produced until the Nazis closed it and forced the family to emigrate. As a pupil in Germany, Mosse attended the boarding school at Salem. After fleeing Germany in 1933, he attended the Bootham School and Cambridge University in England, where he studied history with G. M. Trevelyan and Helen Maude Cam. In 1939, his family relocated to the United States, where he completed undergraduate studies with honors at Haverford College in 1941. He continued his studies on the graduate level at Harvard University, earning a Ph.D. in 1946 with a dissertation written under the supervision of Charles Howard McIlwain that was subsequently published as The Struggle for Sovereignty in England (1950).

Mosse began his career as a historian at the University of Iowa, where he focused on religion in early modern Europe and published a brief study of the Reformation that was widely adopted as a textbook in university courses. In 1955, he moved to the University of Wisconsin—Madison and began lecturing on modern history. His The Culture of Western Europe: the Nineteenth and Twentieth Centuries, An Introduction (1961) summarizes these lectures and was also widely adopted as a textbook.

From 1969, Mosse spent one semester each year teaching at the Hebrew University of Jerusalem. He taught for more than thirty years at the University of Wisconsin, where he was named John C. Bascom Professor of European History and Weinstein-Bascom of Jewish Studies, while concurrently holding the Koebner Professorship of History at Hebrew University. He was also a visiting professor at University of Tel Aviv and Ludwig Maximilian University of Munich. After retiring from the University of Wisconsin, he taught at Cambridge University and Cornell University. He was the first research historian in residence at the U.S. Holocaust Memorial Museum.

Mosse turned to a focus on fascism and Nazism in the 1960s, challenging conventional interpretations in a series of innovative books including The Crisis of German Ideology: Intellectual Origins of the Third Reich (1964), Nazi Culture (1966), The Nationalization of the Masses: Political Symbolism and Mass Movements in Germany from the Napoleonic Wars Through the Third Reich (1975), and Toward the Final Solution: A History of European Racism (1977). In these works, Mosse argued that fascism was not merely brutal, oppressive, and devoid of ideas, but a European-wide mass movement capable of mobilizing large numbers of people. The success of Nazism, he contended, could not be explained by abstract concepts then in vogue such as "totalitarianism," nor by simplifications that traced Hitler's ideas to the precepts of Luther or Hegel. Instead, he located its origins in völkisch ideology, a 19th-century organicist worldview that fused pseudo-scientific with mystical notions of German soul and nature. The Nazis made völkisch thinking accessible to a broadly literate public through potent rhetoric, powerful symbols, and mass rituals. Mosse's originality lay in his ability to connect political movements to deeply held popular and cultural stereotypes, an approach that he applied to the history of European racism. He demonstrated that antisemitism drew on an amalgam of stereotypes that depicted the Jew as the enemy of the German Volk, as the embodiment of the urban, materialistic, scientific, and modern culture supposedly responsible for the corruption of the German spirit. Just as the Nazis tapped a deep vein of völkisch thought, other fascist movements drew on the "new politics" of nationalism to create the secular religions that dominated post-World War I Europe. Fascism, Mosse argued, successfully mediated between people and leaders, expressing itself through rituals, ceremonies, festivals, and striking images. Neither manipulation nor terror, but the ability to provide millions of people with an active and meaningful sense of belonging to a community along with the ability to compromise and achieve tangible economic success, ultimately accounted for the ability of fascist regimesto rule by consensus rather than force, in Germany even more than in Italy.

For Mosse, culture was never simply the literary and artistic achievements of the élites. Defining culture as "a state or habit of mind which is apt to become a way of life," Mosse pioneered the study of mentalities or popular attitudes which were often inconsistent and contradictory ways of coping with reality. In later years, he turned to the broader implications of European culture for the cataclysmic events of the twentieth century, especially World War I and the Holocaust. His 1977 study of European racism, Toward the Final Solution, showed that racial stereotypes were deeply rooted in the European tendency to regard humanity from an aesthetic point of view and to classify human beings according to their closeness or distance from Greek ideals of beauty. Nationalism and Sexuality: Middle-Class Morality and Sexual Norms in Modern Europe (1985) extended these insight to encompass the broader history of the excluded and persecuted...Jews, homosexuals, Gypsies (or Roma), and the mentally ill...in European history. The nineteenth century gave academic and scholarly license to popular cultural stereotypes, defining human beings as "healthy" and "degenerate," "normal" and "abnormal," "insiders" and "outsiders." In his ground-breaking study The Image of Man: The Creation of Modern Masculinity (1996), Mosse traced the ways that the model of middle-class male respectability, beauty, solidity, and self-control established in the eighteenth century constantly evoked "countertypes"...images of men whose weakness, nervousness, effeminacy, degeneracy, or sexual ambiguity threatened to undermine the ideal of manhood.

Much of Mosse's writing and teaching was about the complex legacy of German Jewry for post-Holocaust Jews in America and elsewhere. As he once recalled, "I remember well the shock I received when, shortly after emigration to the United States in 1939, my family was told that we could not go to our chosen vacation spot because it was 'restricted.' And when I wanted to enter the graduate school of my choice, I was told that the Jewish quota was full. I was the first Jew ever hired on the history faculties of the two state universities where I have taught (Iowa and Wisconsin), and this was, I am sure, because I was a German Jew of a 'good family' who had gone to an excellent English public school and Cambridge University."

Mosse's upbringing in a family that represented the best traditions of German-Jewish civility and cultivation attuned him to the advantages but also the dangers of a purely humanistic education. His book German Jews Beyond Judaism (1985) describes the German-Jewish dedication to Bildung, or cultivation, as helping to transcend a narrow group identity. But it also reveals how, during the Weimar Republic, it contributed to a collective blindness toward the harsh and illiberal political realities that engulfed enlightened Jewish families like the Mosses. His skeptical liberalism also informed his supportive but critical judgment on Zionism and the State of Israel. In an essay written on the occasion of the 100th anniversary of Zionism, he wrote that, whereas the early Zionists envisioned a commonwealth that was liberal and based on individualism and solidarity, in the State of Israel a "more aggressive, exclusionary and normative nationalism eventually came to the fore."

At the University of Wisconsin, George Mosse became legendary as a charismatic and inspiring teacher. During the Vietnam War era, despite political divisions among students and faculty, he was able to speak to both sides. Tom Bates' Rads: A True Story of the End of the Sixties (1992) describes how students flocked to Mosse's courses to "savor the crossfire" with his friend and rival, the Marxist historian Harvey Goldberg. Mosse's popularity was due not only to his compelling style of critical skepticism laced with humor, irony and empathy; he was able to address contemporary issues with historical insight without deprecating the opposing view while remaining true to his own principles.

Mosse left a substantial bequest to the University of Wisconsin—Madison to establish the George L. Mosse Program in History, a collaborative program with the Hebrew University in Jerusalem. He also left smaller endowments to support LGBT studies at both the University of Wisconsin—Madison and the University of Amsterdam, where he taught as a visiting professor. The endowment was funded by the restitution of Mosse family properties located in eastern Germany that were expropriated by the Nazi regime and not restored to the Mosses until 1989-90, following the collapse of East Germany. He viewed the use of restituted funds to educate future generations as a validation of his family liberalism and an "unforeseen irony of history" that allowed for some level of justice.