Candy was born in Newmarket, Ontario, in 1950. The son of Sidney James Candy and his wife Evangeline (Aker) Candy, he was raised in a working-class Roman Catholic family. His maternal grandparents, Jozefa (Stefaniuk) and Frank Michael Aker, were immigrants from Eastern Europe, of Polish and Ukrainian ancestry. Candy studied at Centennial College in Toronto and at McMaster University. His first movie role was a small uncredited appearance in the 1973 film Class of ’44. He appeared in several other low-budget films during the 1970s, including the bank-robbery thriller The Silent Partner with Christopher Plummer and Elliott Gould. In 1976, Candy played a supporting role (with Rick Moranis) on Peter Gzowski’s short-lived, late-night television talk show, 90 Minutes Live. That same year, as a member of Toronto’s branch of The Second City, he gained wide North American popularity, which grew when he became a cast member on the influential Toronto-based comedy-variety show Second City Television (SCTV). NBC picked the show up in 1981 and it quickly became a fan favorite. It had won Emmy Awards for the show’s writing in 1981 and 1982. Among Candy’s memorable characterizations for Second City Television were unscrupulous street-beat TV personality Johnny LaRue, 3-D horror auteur Doctor Tongue, sycophantic and easily amused talk-show sidekick William B. Williams, and Melonville’s corrupt Mayor Tommy Shanks. Other characters included the cheerful Leutonian clarinetist Yosh Shmenge, who was half of the Happy Wanderers and the subject of the mockumentary The Last Polka, folksy fishin’ musician Gil Fisher, handsome if accent-challenged TV actor Steve Roman, hapless children’s entertainer Mr. Messenger, corrupt soap opera doctor William Wainwright, smut merchant Harry, “the Guy With the Snake on His Face”, and Giorgy, everyone’s favourite Cossack.

Mimicry was one of Candy’s talents, which he used often at SCTV. Celebrities impersonated by Candy include Jerry Mathers, Divine (Glen Milstead), Orson Welles, Julia Child, Richard Burton, Silvio Gigante, Luciano Pavarotti, Jimmy the Greek, Andrew Sarris, Tip O’Neill, Don Rickles, Curly Howard, Merlin Olsen, Jackie Gleason, Tom Selleck, Gordon Pinsent, Darryl Sittler, Ed Asner, Gertrude Stein, Morgy Kneele, Doug McGrath, and Hervé Villechaize. In 1979, Candy took a short hiatus from SCTV and began a more active film career appearing in a minor role as a U.S. Army soldier in Steven Spielberg’s big-budget comedy 1941 and had a supporting role as police officer Burton Mercer in The Blues Brothers. A year later, Candy played the lovable, mild-mannered Army recruit Dewey Oxberger in 1981’s Stripes, one of the most successful films of the year. In 1983, Candy had a small, but memorable, cameo appearance in Harold Ramis’s National Lampoon’s Vacation and appeared on Saturday Night Live twice (hosting in 1983) while still appearing on SCTV. According to writer-comedian Bob Odenkirk, Candy was reputedly the “most-burned potential host” of SNL, in that he was asked to host many times, only to be told ‘no thanks’ by the SNL staff at the last minute.

In 1983, Candy headlined in the film Going Berserk, and was also approached to play the character of accountant Louis Tully in Ghostbusters (completed and released in 1984), but ultimately did not get the role because of his conflicting ideas of how to play the character; the part went instead to Rick Moranis. Candy was one of the many celebrities who appeared chanting “Ghostbusters” in Ray Parker, Jr.’s hit “single” for the movie. In 1984, Candy played Tom Hanks’s womanizing brother in the hit romantic comedy Splash, generally considered his breakout role. Throughout the latter half of the 1980s, Candy often took roles in substandard films (even performing the voice of a talking horse in the Bobcat Goldthwait comedy Hot to Trot). While continuing to play supporting roles in films like Spaceballs, Candy was awarded the opportunity to headline or co-star in such comedy films as Volunteers; Planes, Trains and Automobiles; Brewster’s Millions; The Great Outdoors; Armed and Dangerous; Who’s Harry Crumb?, Summer Rental, and Uncle Buck. He also continued to provide memorable bit roles, including a “weird” disc jockey in the comic musical film Little Shop of Horrors and a policeman in the Sesame Street film Follow That Bird.

Candy also produced and starred in a Saturday-morning animated series on NBC titled Camp Candy in 1989. The show was set in a fictional summer camp run by Candy, featured his two children in supporting roles, and also spawned a brief comic book series published by Marvel Comics’ Star Comics imprint. In the early 1990s, Candy’s career went into decline after he appeared in a string of critical and commercial failures, including Nothing but Trouble (for which he was nominated for a Razzie as “worst supporting actress,” playing a woman), Delirious, and Once Upon a Crime, although he did appear in major successes such as Rookie of the Year (uncredited), The Rescuers Down Under, Home Alone and Cool Runnings. Candy attempted to reinvigorate his acting career by broadening his range and playing more dramatic roles. In 1991, Candy appeared in a light romantic drama, Only the Lonely, which saw him as a Chicago cop torn between his overbearing mother (Maureen O’Hara) and his new girlfriend (Ally Sheedy). The same year and in rare form, Candy played a dramatic role as Dean Andrews Jr., a shady Southern lawyer in Oliver Stone’s JFK.

In 1991, Bruce McNall, Wayne Gretzky, and Candy became owners of the Canadian Football League’s Toronto Argonauts. The celebrity ownership group attracted a lot of attention in Canada and the team spent a significant amount of money, even signing some highly touted National Football League prospects like wide receiver Raghib Ismail. The Argonauts took home the 1991 Grey Cup beating Calgary 36–21 in the final. In 1994, while filming Wagons East! on location in Durango, Mexico, Candy called his friends, including Canadian Football League commissioner Larry Smith, and told them that he had just let go of his team and was putting it up for sale. He then called his assistant, who invited him to play golf with him in the spring when he came back to Toronto. After cooking a late lasagna dinner for his assistants, Candy called his co-stars from his hotel, then went to sleep. After midnight, on March 4, 1994, Candy died from a heart attack.  Candy was survived by his wife Rosemary Hobor, and his two children Jennifer Candy and Christopher Candy.