Born in Los Angeles, Lamb was a student at the University of California, Berkeley, graduating in chemistry in 1934 and gaining his PhD in physics in 1938. His thesis research, on the electromagnetic properties of nuclear systems, was directed by J. Robert Oppenheimer. In 1938 he became an instructor in physics at Columbia University, New York, becoming a professor in 1948, and from 1943 to 1951 he was also associated with the Columbia Radiation Laboratory. It was at Columbia that he performed the experiments on the fine structure of the hydrogen spectrum that led to his receiving the 1955 Nobel Prize for physics.

Shortly after World War II, Lamb began his work to check the accuracy of the predictions of Paul Dirac as they related to the energy levels and spectral lines of hydrogen. Dirac's quantum mechanical theory predicted that the hydrogen atom had two possible energy states with equal energies. Lamb's accurate work using radiofrequency resonance techniques, reported in 1947, revealed that there was a minute difference in these energy levels. Small as it was, this Lamb shift necessitated a revision of the theory of the interaction of the electron with electromagnetic radiation. For this work Lamb was awarded the Nobel Prize for physics, which he shared with another leader of research at Columbia, Polykarp Kusch, with whom he had performed wartime research in developing microwave radar.

In 1951 Lamb was made a professor of physics at Stanford. There he devised microwave techniques for examining the hyperfine structure of the spectral lines of helium. In 1956 he took a professorship in England at Oxford University, and in 1962 returned to America to a professorship at Yale. He was professor of physical and optical sciences at the University of Arizona's department of physics from 1974 until his retirement in 2008.

His publications include Laser Physics (1974), written in collaboration with M. Sargent and M. O. Scully.