Doherty was born in Derry in Northern Ireland, and from 1978 to 1981 studied at Ulster Polytechnic in Belfast. As a child he witnessed Bloody Sunday in Derry, and many of his works deal with The Troubles. Some of his pieces take images from the media and adapt them to his own ends.
These and other works by Doherty explore the multiple meanings that a single image can have. Doherty has again suggested that this interest may stem from his witnessing of Bloody Sunday and subsequent knowledge that many photos of the incident did not tell the whole truth. Some of Doherty's earliest works are of maps and similar images accompanied by texts in a manner similar to the land art of Richard Long, except that here the text sometimes seems to contradict the image.
Doherty's video pieces are often projected in a confined space, giving a sense of claustrophobia. The videos themselves sometimes create a mood that has been compared to film noir.
Doherty has acknowledged the importance of the Orchard Gallery in Derry as a venue where he could see modern art in his formative years, and in later years he received much help and support from the gallery's then-curator, Declan McGonagle.
Doherty was shortlisted for the Turner Prize in 1994 and 2003.