James McHenry entered the American Revolution as a physician trained under Benjamin Rush. Serving as surgeon to the Fifth Pennsylvania Battalion, he was captured when Fort Washington fell to the British in November 1776. After parole and exchange he returned to the army. In May 1778 he joined George Washington's staff as an assistant secretary, moving from medical work into military administration and correspondence.

He later served on Lafayette's staff during the southern campaigns and left the army in 1781 for Maryland politics. McHenry sat in the state senate and represented Maryland in the Continental Congress. In 1787 he attended the Constitutional Convention, although family circumstances caused absences and he played a limited part in debate. His notes nevertheless provide evidence of the proceedings. He signed the Constitution and worked for its ratification in Maryland.

McHenry continued in the Maryland legislature before Washington appointed him secretary of war in 1796. He remained in office under John Adams, dealing with frontier posts, army administration, coastal defense, and preparations during the crisis with France. The growth of the army and disputes over its senior officers drew him into conflicts within the Federalist leadership. His close alignment with Alexander Hamilton increasingly estranged him from Adams.

In 1800 Adams forced his resignation as part of the rupture with Hamilton's supporters. McHenry returned to his estate near Baltimore, maintained his Federalist associations, and opposed the War of 1812. Religious and charitable work also occupied his later years. Fort McHenry, named for him during his lifetime, became famous for its defense of Baltimore in 1814, but he was neither its battlefield commander nor the author of the anthem inspired by that defense. He died in 1816. His administrative career exposed the divisions within the Federalist Party during the transition from Washington to Adams.