Paul Gardner Allen was born in Seattle, Washington, to Kenneth Sam Allen and Edna Faye Allen. His father was an associate director of libraries for the University of Washington, and his mother was a schoolteacher. His early exposure to books and learning fostered a lifelong intellectual curiosity and love for science and technology.

A pivotal moment in Allen's life occurred when he met Bill Gates at Lakeside School, a private school in Seattle. Their shared passion for computers and programming quickly forged a close friendship and partnership. The school's teletype terminal and access to computer time were instrumental in nurturing their early coding skills.