Born in the village of Ajido, 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 programme, and applied for it. He came to the United States of America on the Rotary scholarship in 1950 and was educated at Morehouse College in Atlanta, Georgia.
After graduating from Morehouse, Olatunji went on to New York University to study public administration. There, he started a small percussion group to earn money on the side while he continued his studies. He won a following among jazz musicians, and Columbia Records A&R man John Hammond signed him to the Columbia label in 1957.
In 1959 Olatunji released his first record on Columbia, called Drums of Passion. 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.
Olatunji's subsequent recordings include Drums of Passion: The Invocation (1988), Drums of Passion: The Beat (1989), and Love Drum Talk (1997). Olatunji also recorded with Grateful Dead member Mickey Hart on his Planet Drum projects.
Olatunji was also a music educator, and invented a method of teaching and recording drum patterns. He taught at the Esalen Institute in California starting in 1995 until his death from diabetes in 2003.