The son of an electrical engineer, Bakker was born in Ridgewood, New Jersey, and educated at Yale and at Harvard, where he completed his PhD in 1976. After teaching for eight years at Johns Hopkins University, Baltimore, he moved to Boulder, Colorado, in 1984 to work as an independent paleontologist.

In the early 1970s, while still a graduate student, Bakker argued that traditional views on the nature of dinosaurs were misguided. Dinosaurs, he claimed, were warm-blooded, like mammals, and not cold-blooded like reptiles. In support Bakker offered three main arguments derived from comparative anatomy, latitudinal zonation, and ecology.

Anatomically the bones of endotherms (warm-blooded creatures) are rich in blood vessels and show no growth rings. Precisely these features are found in mammals, birds, and, Bakker noted, dinosaurs as well. They are lacking in cold-blooded reptiles (ectotherms).

Further, endotherms can cope with most temperature variations and can be found in temperate, arctic, and equatorial zones. Large reptiles, however, cannot survive cool winters. Yet, during the Cretaceous, dinosaurs could have been found in the far north of Canada, well within the Arctic Circle.

Finally Bakker points to predator–prey ratios. The Komodo dragon, the largest living lizard, consumes its own weight every 60 days, a lion in only eight days. Such are the demands of endothermy. As a consequence a community can support fewer warm-blooded predators than cold-blooded predators. The predator–prey ratio, Bakker argued, is a constant characteristic of the predator's metabolism. Calculations revealed that a given biomass can support a warm-blooded predator biomass of 1–3%, and a cold-blooded predator biomass of up to 40%. Given that some fossil deposits yield remains of thousands of individuals, their predator–prey ratio should be measurable. And Bakker did find that amongst the reptiles of the Permian (285–225 million years ago) the ratio was very high (35–60%), while the dinosaurs of the Triassic (225–195 million years) had a ratio of only 1–3%.

Bakker's work called for a revision of vertebrate systematics. In traditional classifications birds and dinosaurs are seen as collateral descendants of thecodonts, that is, animals with teeth set in sockets. Bakker, however, has proposed that birds are descended from dinosaurs. Such views, vigorously and frequently expressed, have made Bakker a controversial and well-known figure.

Bakker has sought to reach an even wider public with his Raptor Red (1995), a novel dealing with a year in the life of Utahraptor, a much bigger version of the Velociraptor of Jurassic Park.