Newby was born and grew up near Hammersmith Bridge, London, and was educated at St Paul's School. His father was a partner in a firm of wholesale dressmakers but he also harboured dreams of escape, running away to sea as a child before being captured at Millwall. Owing to his father's frequent financial crises and his own failure to pass algebra, Newby was taken away from school at sixteen and put to work as an office boy in the Dorland advertising agency on Regent Street, where he spent most of his time cycling around the office admiring the typists' legs. Fortunately, the agency lost the Kellogg's account and he apprenticed aboard the Finnish windjammer Moshulu in 1938, sailing in what Newby entitled The Last Grain Race (1956) from Europe to Australia and back by way of Cape Horn (his journey was also pictorially documented in Learning the Ropes). In fact, two more grain races followed the 1939 race in which Newby participated, with the last race being held in 1949.

In 1940, Newby was commissioned into the Black Watch in India before volunteering for the Special Boat Section, then operating out of Alexandria. In August 1942 his detachment was sent on operation Whynot, an effort to sabotage the German airfield at Catania in Sicily. The goal was to disable Junkers Ju 88 bombers there in support of Operation Pedestal, an attempt to break the Siege of Malta. No one had told them there were 1,000 German troops guarding the airfield, and the entire party was captured. Between 1942 and 1943, he was held prisoner of war in a camp at Fontanellato, in the Po Valley.

After the announcement of the Italian Armistizio in September 1943, Newby made his escape with a broken ankle into the surrounding countryside. He was initially helped by his future wife, Wanda, the daughter of a Slovene teacher, and later sheltered at great risk by the local Italian peasantry. He passed the winter of 1943 with Luigi and Agata on the remote Pian del Sotto, having to do the back-breaking work of clearing stones from their fields, and then hiding out in a cave. These experiences were described in vivid detail in perhaps his most memorable book Love and War in the Apennines. He and his fellow English escapee, James, were eventually betrayed by a local schoolteacher, and captured by Fascist milizia after about five months of freedom. Newby spent the rest of the war in Czechoslovakian and German prison camps. He was awarded the Military Cross in 1946 for his part in the ill-fated Whynot raid. He then worked for MI9, helping and rewarding those who had sheltered escaped prisoners, and this allowed him to woo and finally marry the beautiful Wanda Skof. He ended the war as a Lieutenant and then served in the Territorial Army Special Air Service.

Newby spent the next ten years in his father's dressmaking business, later recalling his time in Something Wholesale (1962), then for the couture house of Worth Paquin (1955-56) and then for the publishers Secker & Warburg. He returned to fashion as a central buyer for the John Lewis department stores, but he was not suited to the 9-5 routine.

Ill-prepared and inexperienced, Newby and his friend Hugh Carless set out to climb Mir Samir, an unclimbed glacial peak of in the Nuristan mountains of Afghanistan, an expedition later chronicled in A Short Walk in the Hindu Kush (1958), probably his most widely known work. Newby's style was inspired by the comic portrait of Englishmen abroad presented in the writings of novelists such as Evelyn Waugh and Jerome K. Jerome. In a preface to A Short Walk, Waugh identifies the central elements of this humorous tradition: its quintessentially English spirit of amateurism and a tone of ironic understatement.

Having endured a month of hardship during their adventure in Afghanistan and nearing the end of their trip, a somewhat 'knackered' Newby encountered the striding form of Wilfred Thesiger on the banks of the Upper Panjshir, describing their meeting as that of an inept amateur and professional adventurer.

In 1963, he and his wife, Wanda set out to travel the of the Ganges by rowing boat, described in Slowly Down the Ganges (1966). From 1963 to 1973, Newby was travel editor for The Observer newspaper, writing several more books and often accompanied on his travels by his wife.

His later works include The Big Red Train Ride (1978), On The Shores of the Mediterranean (1984) and Round Ireland in Low Gear (1987).

He also made travel films for the BBC, returning to Parma with his wife Wanda in The Travel Show (directed by Paul Coueslant, 1994) and visiting one of his favourite cities, Istanbul (1996).

In 2005, for the first time in France, his photographic work about the last grain race in 1938-39 was exhibited by the Musée Portuaire of Dunkirk as a part of "Cap sur le Horn". Jacopo Brancati, was the curator of this exhibition section.

For many years Newby lived in Dorset before finally moving to Surrey. He died in Guildford on 20 October 2006 aged 86.

Newby was appointed a CBE in 1994 and awarded the Lifetime Achievement Award of the British Guild of Travel Writers in 2001. He was also a Fellow of the Royal Society of Literature and the Royal Geographical Society.

His life and work were profiled in ITV's The South Bank Show (1994) and in the BBC's Travellers' Century (2008), presented by fellow travel writer Benedict Allen.