son of Goldie ( Drell) and Samuel Paley. His family was Jewish, and his father was an immigrant from Ukraine who ran a cigar company. As the company became increasingly successful, Samuel Paley became a millionaire, and moved his family to Philadelphia in the early 1920s.

William Paley matriculated at Western Military Academy in Alton, Illinois, but later transferred to, and recorded his degree from, the University of Pennsylvania,