After gaining his Bachelor of Science degree in 1937 and a Ph.D. degree in 1940 at the London School of Economics (LSE) under supervision of Arnold Plant, Lewis worked as a member of the staff at the LSE until 1948. In 1947, he married Gladys Jacobs, and they had two daughters together.
Lewis published in 1954 what was to be his most influential development economics article, "Economic Development with Unlimited Supplies of Labour" (Manchester School). In this publication, he introduced what came to be called the dual sector model, or the "Lewis model".
Lewis published The Theory of Economic Growth in 1955 in which he sought to “provide an appropriate framework for studying economic development,” driven by a combination of “curiosity and of practical need.”
When Ghana gained independence in 1957, its government appointed Lewis as their first economic advisor. He helped draw up its first Five-Year Development Plan (1959–63).
In 1959 Lewis returned to the Caribbean region when appointed Vice Chancellor of the University of the West Indies. In 1963 he was knighted for his contributions to economics.
Lewis received the Nobel prize in Economics in 1979, sharing it with Theodore Schultz.
That year, he was also appointed a University Professor at Princeton University and moved to the United States. Lewis worked at Princeton for the next two decades, teaching generations of students until his retirement in 1983. In 1970 Lewis also was selected as the first President of the Caribbean Development Bank, serving in that capacity until 1973.
He died on 15 June 1991 in Bridgetown, Barbados. He was buried in the grounds of the St Lucian community college named in his honour. He was survived by his wife, Gladys Jacobs, Lady Lewis of Barbados and Princeton, NJ; two daughters, Elizabeth Lewis of Cranbury, NJ, and Barbara Virgil of Brooklyn; and four brothers: Stanley Lewis of Ghana, Earl Lewis of Trinidad, Allen Montgomery Lewis, a former Governor General of St Lucia, and Victor Lewis of St Lucia.