O'Donel Levy, known as Butch, was born on September 20, 1945, in Baltimore, Maryland, and grew up in the Gilmor Homes housing project in West Baltimore. His father and uncle played guitar at home, and he wanted to play from the age of four or five; the singer Ethel Ennis, a neighbor who left the project for jazz gigs, showed him what a musician's life could look like. He studied at the Peabody Institute in Baltimore and was working professionally by 16, first with the local saxophonist Boyd Anderson and then in a quartet with drummer Chester Thompson, organist Charles Covington, and vocalist Judd Watkins, part of the city's early-1960s organ-combo scene. Thompson and Covington stayed central to his records for much of the 1970s.

After moving to New York he worked the organ-trio circuit and toured with George Benson; a 2009 profile adds that he took Benson's guitar chair in Jack McDuff's trio at Paul's Mall in Boston. His most visible early work was with the organist Jimmy McGriff, on Black Pearl (Blue Note, 1971), recorded live at the Golden Slipper in Newark, and on the 1972 United Artists album Jimmy McGriff, Junior Parker, from the same club. He also played on the 1973 Groove Merchant live set Giants of the Organ in Concert, taped at Paul's Mall with McGriff and Richard "Groove" Holmes, and on Holmes's New Groove (1974). On the McGriff-led Concert: Friday the 13th at Cook County Jail, released in 1973, he is one of two guitarists, with George Freeman, on the two-part "Freedom Suite" that fills the first side.

The producer Sonny Lester, who had overseen Black Pearl, signed him to the Groove Merchant label, and between 1971 and 1976 he made six albums for it. Black Velvet (1971) set his guitar in a small band with trumpet and tenor saxophone and a program of pop and soul songs such as "Watch What Happens," "Misty," and "I'll Be There." Breeding of Mind (1972) added arrangements by Manny Albam, with strings and flugelhorns on its first four tracks, and Dawn of a New Day (1973) set him against a brass section that included Jon Faddis, Marvin Stamm, Cecil Bridgewater, and Bill Watrous. Simba, recorded on July 2 and 3, 1973, and released in 1974, was the high point of the Albam collaboration, with Steve Gadd on drums, Tony Levin on bass, Warren Bernhardt on electric piano, and horn players including Lew Soloff, Eddie Daniels, and Faddis. Everything I Do Gonna Be Funky (1974) leaned toward vocals, keyboards, and synthesizer, and drew notice for its provocative cover photograph. Windows (1976), recorded in August in Washington, D.C., added the singer Aleta Greene, his brother Stafford Levy on drums, and horn and string arrangements by Brad Baker, with trumpeters Lew Soloff and Randy Brecker. A further album, Time Has Changed (1977), appeared on Lester's Lester Radio Corporation label, and in 1978 he was one of three guitarists on The Boston Concert, a live date led by McGriff and Holmes.

By 1980 he was leading a quartet in Washington, D.C., where Herbie Mann heard his trio and hired it for a tour. On Mann's See Through Spirits (Atlantic, 1985) Levy plays guitar and Roland guitar synthesizer, sings lead on two tracks, and wrote four of the pieces, including "Keep the Spirits Singing" and "T.V.E." In Baltimore he produced the 1982 album Through a Song for ILM Productions, a local imprint, playing guitar, synthesizer, bass, and piano and singing, with the young drummer Dennis Chambers; he also soloed on two tracks of Norman Connors's Passion (1988). After the tours with Mann he moved to Singapore around 1989 and lived there for about ten years, playing at the Saxophone Bar on Cuppage Terrace, a room the Esplanade's history of Singapore jazz counts among the few places for straight-ahead jazz in the late 1980s and 1990s. He worked there with the pianist Jeremy Monteiro, who put him on the 1993 album My Foolish Heart and on two tracks of Blues for the Saxophone Club (1996) with bassist Eldee Young, drummer Redd Holt, and tenor saxophonist Ernie Watts, and a friend's 2012 blog post places him at the Montreux Jazz Festival in 1988 alongside Monteiro, Young, Holt, and saxophonist John Stubblefield.

He returned to Baltimore in the late 1990s and built a studio in Bel Air, Maryland, where he produced several albums. His own late releases were Asia Beat (a self-issued CD of blues and soul songs listed as 2002 or 2004) and In the Name of Love (2005, Room 302), an album of his own songs. A major stroke on October 20, 2006, left him partly paralyzed, and Baltimore musicians organized benefit concerts for his medical costs. His Groove Merchant records were reissued on CD by Lester's LRC label and in Japan, a Japanese three-CD set of Black Velvet, Windows, and Dawn of a New Day appeared in 2023, and Mr Bongo reissued Simba on February 23, 2024. O'Donel Levy passed away on March 14, 2016, at the age of 70.

AllMusic files Levy under jazz and R&B with the styles funk, fusion, and soul jazz, and his records sit where those meet: a warm, round guitar tone, muscular chord voicings and clean single-note lines, set against pop and soul covers, original funk grooves, and large studio arrangements. Reviewers have heard the Wes Montgomery and Grant Green tradition in his leads on Dawn of a New Day, called Black Velvet mellow and smooth, and described Windows, which followed George Benson's Breezin', as a vocal-tinged fusion record that never turns into smooth jazz; AllMusic's Sean Westergaard named Simba as the Levy album to own. Levy said he learned by studying the solos of John Coltrane, Miles Davis, and Chick Corea until he could play their lines before finding his own. His Groove Merchant tracks have since been picked up on jazz-funk and rare-groove compilations, and Sonny Lester remained his producer through the 1970s.