After studying philosophy at Leipzig and Halle,became a privatdocent at Heidelberg in 1850. The Baden government in 1853 laid an embargo on his teaching owing to his liberal ideas, but the effect of this was to rouse considerable sympathy for his views, and in 1856 he obtained a professorship at Jena, where he soon acquired great influence by the dignity of his personal character. In 1872, on Eduard Zeller's removal to Berlin, Fischer succeeded him as professor of philosophy and the history of modern German literature at Heidelberg.

One of Fischer's most significant and lasting contributions to philosophy was the use of the empiricism/rationalism distinction in categorising philosophers, particularly those of the 17th and 18th century. These include John Locke, George Berkeley and David Hume in the empiricist category and René Descartes, Baruch Spinoza and Gottfried Leibniz in the rationalist category. Empiricism, it is said, claims that human knowledge is derived from sensation, i.e. experience, while rationalism claims that certain knowledge can be acquired before experience through pure principles. Although influential, in more recent times this distinction has been questioned as anachronistic in its failure to represent precisely the exact claims and methodologies of the philosophers it categorises.