Francis Greenwood Peabody was born in Boston on December 4, 1847, to Mary Jane Derby and Ephraim Peabody, a Unitarian minister. After Ephraim Peabody's untimely death in 1856, his former congregation provided the funds for his son's education. Francis graduated from Harvard College (1869) and received degrees from the Divinity School (1872) and from the Graduate School (1872).
After a brief time as chaplain and teacher at Antioch College in Ohio, Peabody served as minister at the First Parish in Cambridge, a Unitarian church. In 1880, Peabody became a lecturer on ethics and homiletics at Harvard Divinity School. He subsequently served as the Parkman Professor of Theology (1881–1886), Preacher to the University (1886–1906), Plummer Professor of Christian Morals (1886–1912), and Dean of the Divinity School (1901–1906).
Although Peabody strongly influenced the religious, moral, and philosophical climate of Harvard as the University Preacher and Plummer Professor, his most enduring achievement was his introduction of the study of social ethics to the Divinity School and Harvard College. Peabody's social ethics courses stressed the need to study the religious and social implications stimulated by industrialization, and he championed social-science methodology, the case study method, and liberal interpretations of the New Testament. In his teaching, preaching, and writing, Peabody characterized Christianity as a religion that required Christians to act as agents of social change, de-emphasizing personal salvation in favor of social action. He also used photography to document social problems and strengthen support for social reform.