Cannell was born in Los Angeles, California, and raised in nearby Pasadena. His parents, Carolyn (née Baker) and Joseph Knapp Cannell, owned a chain of furniture stores. Cannell struggled with dyslexia in school, but did graduate from the University of Oregon in 1964 with a Bachelor of Science degree in journalism. At UO, he joined the Sigma Chi fraternity.
After college, Cannell spent four years working with the family business before selling his first script to the Universal series It Takes a Thief in 1968. He was quickly hired by the television production branch of Universal Studios and was soon freelance writing for such other crime shows as Ironside and Columbo. Not long after, he received his first full-time gig as the story editor of Jack Webb's police series Adam-12, then in its fourth season (1971—1972).
Cannell created or co-created nearly 40 television series, mostly crime dramas, including The Rockford Files, The Greatest American Hero, The A-Team, Wiseguy, 21 Jump Street, Silk Stalkings, and The Commish. In the process he had, by his own count, scripted more than 450 episodes, and produced or executive produced over 1,500 episodes.
He described his early financial arrangements in a 2002 interview, saying that at Universal,
For many years, Cannell's office was at Paramount Studios in Hollywood, though his shows (with the exception of Hunter and The Greatest American Hero) were almost always distributed by Universal Studios. The closing logo of his production company features him typing, before throwing the sheet from his typewriter whereupon it animates to become his company logo against a black screen (the one sheet of paper lands on a stack of paper forming a letter C). It was updated often, the main differences being Cannell's clothes, sometimes new awards were in the background and (rarely) a new office for the live-action part. Early examples are also notable for Cannell smoking a pipe as he types. The logo has become part of American pop culture and has been parodied on both The Simpsons and Family Guy. After his death, an episode of Castle showed Cannell's logo with the words "Colleague, Mentor, Friend" while he is typing and "We'll miss you, pal" superimposed over the sheet of paper.
Cannell also acted occasionally, including a regular supporting role as "Dutch" Dixon on his series Renegade. He also took a turn in an episode of Silk Stalkings, in which the script called for one character to tell him, "You look just like that writer on TV," to which Cannell's character responds, "I get that all the time." He also served as the host of the 1995—1996 syndicated documentary series U.S. Customs Classified, focusing on the work of the U.S Customs Service. Cannell appeared as himself in the pilot of the ABC show Castle and again in season 2. Along with James Patterson and Michael Connelly, he was one of Castle's poker buddies.
In an effort to lower production costs, Cannell opened a studio facility in Vancouver, British Columbia toward the end of the 1980s. One of the first series shot there was 21 Jump Street, the highest-rated show of the new Fox network's first season. Scene of the Crime, a mystery anthology series for CBS's late-night schedule, was also filmed in Vancouver and hosted by Cannell. New World Communications acquired his production company in 1995. Cannell then founded the Cannell Studios. One of the first shows produced by the newly-established Cannell Studios was the short-lived but critically-acclaimed corporate drama Profit.
In the 2000s, Cannell turned his attention to novels. As of 2008, he had written 14, half of which featured the character of detective Shane Scully of the Los Angeles Police Department. The eighth book in that series, On the Grind (St. Martin's Press), was scheduled for release January 2009.
Cannell collaborated with Janet Evanovich on the book No Chance, which was to be the first in a series. It was scheduled for release in October 2007, but as of July 2007 was unreleased.
The documentary The Movie features an interview with Cannell, in which he discusses his struggles with dyslexia and how he managed to be such a successful writer despite his difficulties reading. During the interview, he mentions how he used to hire typists to overcome his "spelling problem", as he refers to his dyslexia, but also describes how he feels his condition has enriched his life.
Cannell's hit TV series The A-Team was remade into a 2010 feature length film. Cannell served as a producer and creative consultant for the project.
As of 2009, Cannell lived in Los Angeles. He married his high school sweetheart, Marcia; he "asked her to go steady in the eighth grade". Together they had two daughters, Tawnia and Chelsea, and two sons, Cody and Derek. Derek died in 1981 at age 15 when a sand castle he was building at the beach collapsed and suffocated him.
Cannell was dyslexic, and was a spokesperson on the subject. According to an episode of Paul Harvey's The Rest of the Story, Cannell frequently had to dictate ideas or even complete scripts to a personal secretary. He discussed his experiences as a dyslexic in the upcoming documentary The Movie.
Cannell continued to write on a typewriter (an IBM Selectric) and only used a computer for research purposes.