Simon was born in Oxford on 12 January 1959, the only child of Christopher Tolkien and his first wife, Faith Faulconbridge. His parents separated when he was five years old and he grew up with his mother. He was educated at the Dragon School in Oxford and then Downside School. He studied modern history at Trinity College, Oxford, after which he embarked on a fifteen-year career as a criminal lawyer. In 1984, he married Tracy Steinberg who was born in 1962. They have two children, a son Nicholas and a daughter Anna. Tracy owned and operated a vintage clothing store in Chelsea, London, called Steinberg & Tolkien, which shut in September 2007.
He became a barrister in 1994. In January 2000, he began writing fiction. His first novel, which he has described as a black comedy, was not accepted for publication. His second novel, a courtroom drama, was published in the United States as The Final Witness in 2002 and in United Kingdom as The Stepmother in 2003. His second published work, The Inheritance (the first of a trilogy featuring Inspector Trave of the Oxfordshire Criminal Investigation Department), was published in 2010. The second book of the Inspector Trave trilogy, The King of Diamonds, was released in 2011. The third and final book in the trilogy, Orders from Berlin, was released in 2012.
Simon Tolkien notably disagreed with the policy of his grandfather's estate in regard to the The Lord of the Rings films. When Christopher Tolkien issued a statement that the "Tolkien estate would be best advised to avoid any specific association with the films", Simon Tolkien broke ranks, offering to cooperate with the filmmakers, stating "It was my view that we take a much more positive line on the film and that was overruled by my father." Following up a 2001 interview with the Independent, Simon in 2003 gave interviews to the Daily Telegraph and other media in which he discussed his strained relationship with his father, describing it as a permanent breach. However, they have since reconciled.
Simon Tolkien currently lives in southern California with his wife Tracy. Simon's son Nicholas is a playwright and director who debuted with his first play Terezin in June 2017.