Steve Lacy was born Steven Norman Lackritz on July 23, 1934, in New York City. He began playing soprano saxophone at sixteen and was soon performing with Dixieland musicians decades older than himself. By nineteen he was playing with pianist Cecil Taylor, whose own career is covered in full in his JazzProfiles.com profile, a partnership that ignited Lacy's own interest in the avant-garde; he performed on Taylor's 1956 debut album Jazz Advance and appeared with Taylor's groundbreaking quartet at the 1957 Newport Jazz Festival.

His most enduring musical relationship was with the compositions of Thelonious Monk: he recorded Reflections (Prestige, 1958), the first album devoted entirely to Monk compositions, and briefly played in Monk's own band in 1960. Lacy became the first avant-garde jazz musician to specialize in the soprano saxophone, an instrument that had been almost entirely neglected during the bebop era, and produced more than 100 recordings as bandleader or collaborator across his career, winning Down Beat's "Best Soprano Saxophonist" poll repeatedly. He received a MacArthur "Genius Grant" Fellowship in 1992.

Lacy died June 4, 2004, at New England Baptist Hospital in Boston, at age 69, survived by his wife and longtime collaborator, Swiss singer Irene Aebi.

Lacy's decision to specialize in soprano saxophone at a time the instrument had been almost entirely abandoned, combined with his deep, career-long engagement with Thelonious Monk's compositions and his early avant-garde apprenticeship under Cecil Taylor, made him one of the most singular voices to emerge from the post-bop era.