Olatunji was born in the village of Ajido, a small town near Badagry, Lagos State, in southwestern Nigeria. A member of the Yoruba people, Olatunji was introduced to traditional African music at an early age. He read in Reader's Digest magazine about the Rotary International Foundation's scholarship program, and applied for it. He went to the United States of America in 1950.
He received a Rotary scholarship in 1950 and was educated at Morehouse College in Atlanta, Georgia.
Olatunji won a following among jazz musicians, notably creating a strong relationship with John Coltrane and Columbia Records A&R man John Hammond who signed him to the Columbia label in 1957. With Coltrane's help, he founded the Olatunji Center for African Culture in Harlem. This was the site of Coltrane's final performance. In 1959 Olatunji released his first of six records on the Columbia label, called Drums of Passion.
In 1969, Carlos Santana had a major hit with his cover version of this first album's "Jin-go-lo-ba", which Santana recorded on his debut album, Santana, as "Jingo." Olatunji favoured a big percussion sound, and his records typically featured more than 20 players, unusual for a percussion based ensemble. Drums of Passion became a major hit and remains in print; it introduced many Americans to world music. Drums of Passion also served as the band's name. Notable band members included; Clark Terry, Bill Lee, Horace Silver, Yusef Lateef, Sikiru Adepoju and Charles Lloyd, among others.
Olatunji's subsequent recordings include Drums of Passion: The Invocation (1988), Drums of Passion: The Beat (1989) (which included Airto Moreira and Carlos Santana), Love Drum Talk (1997), Circle of Drums (2005) (originally titled Cosmic Rhythm Vibrations, with Muruga Booker and Sikiru Adepoju), and Olatunji Live at Starwood (2003 recorded at the 1997 Starwood Festival) with guest Halim El-Dabh. He also contributed to Peace Is The World Smiling: A Peace Anthology For Families on the Music For Little People label (1993).
Olatunji recorded with many other prominent musicians (often credited as "Michael Olatunji"), including Cannonball Adderley (on his African Waltz (1961) album), Horace Silver, Quincy Jones, Pee Wee Ellis, Stevie Wonder, Randy Weston, and with Max Roach and Abbey Lincoln on the pivotal Freedom Now Suite aka We Insist, and with Grateful Dead member Mickey Hart on his Grammy winning Planet Drum projects. He is also mentioned in the lyrics of Bob Dylan's "I Shall Be Free" as recorded on the album The Freewheelin' Bob Dylan.
Olatunji composed music for the Broadway theatrical and Hollywood film productions of Raisin in the Sun.
Olatunji was known for making an impassioned speech for social justice before performing in front of a live audience. His progressive political beliefs are outlined in The Beat Of My Drum: An Autobiography, with a foreword by Joan Baez, (Temple University Press, 2005).
He toured the American south with Rev. Martin Luther King Jr and joined King in the march on Washington.
He co-wrote, Musical Instruments of Africa: Their Nature, Use and Place in the Life of a Deeply Musical People with Betty Warner-Dietz (John Day Company, 1965). He taught a summer drumming and African dance course with his wife, at the Omega Institute in Rhinebeck, New York for many summers during Family week. He also taught at the Esalen Institute in California from 1985 until shortly before his death in Salinas, California from diabetes in 2003, on the day before his 76th birthday.