McRae was selected by the Reds in the 6th round of the 1965 draft with the 117th overall pick. Then in the pre-1969 offseason, playing winter ball in Puerto Rico, McRae suffered a multiple leg fracture sliding on the basepaths. In the words of Bill James in The Bill James Historical Baseball Abstract, "Before the accident, McRae was a burner, a center fielder who could fly...after the accident, his speed was major league average." He was considered a below-average outfielder with the Reds.
In spring training 1969, McRae came to the Reds' camp with his leg still in a cast from the fracture. The same offseason, St. Louis Cardinals announcer Harry Caray had suffered multiple fractures being struck by a car while on foot. During a Reds-Cardinals preseason game where Caray was interviewing ballplayers on the field while still on crutches, Reds Manager Dave Bristol pointed in Caray's direction and said to McRae, "Look at that. There's an old man. Broke two legs. Broke his shoulder. Broke his everything. And here he is walking around doing his job, doing anything he wants. Here you are, all you did was break your leg sliding into second base, and you can't get your leg out of your goddam cast! You ought to be ashamed of yourself."
McRae later mentioned to Caray that it was one "one of the best motivational speeches he'd ever heard. He learned that he had to want to recover before he'd really be able to." Later in his career, Royals teammate Dan Quisenberry recalled, whenever a Royals player took time off because of injury, "McRae gets dressed like a commando, hides in a trash can in the clubhouse, and then jumps out and 'shoots' the guy...McRae believes that if a guy is hurt and can't play, he's dead to the club, so McRae shoots him and kills him."
In 1976 McRae was on top of the AL batting title race going into the final game of the season, in which his teammate George Brett went 2-for-4 to clinch the title over McRae by a margin of less than .001; McRae finished second. Oddly, the other two of the top four finishers that season, the Minnesota Twins' Rod Carew and Lyman Bostock, played in that same game.
After his recovery from the leg fracture, McRae became known as "the most aggressive baserunner of the 1970s," as quoted by James, "a man who left home plate thinking 'double' every time he hit the ball...he taught the younger players and reminded the veterans to take nothing for granted, and to take no prisoners on the bases." McRae played hard—so hard, in fact, that the rule requiring a runner to slide into second base when breaking up a double play is still referred to as the Hal McRae Rule in honor of the man whose cross-body blocks into second base broke up a lot of double plays and second basemen at the same time.
Following his playing retirement, McRae managed the Royals (1991–94) and Tampa Bay Devil Rays (2001–02). While managing the Royals, McRae was involved in an infamous incident after a game on April 26, 1993 (a 5–3 loss against the Detroit Tigers) in which he lost his temper with reporters and trashed his entire office, throwing things off of his desk including a phone, which cut a reporter on impact, and yelling profanities at reporters. He also served as hitting coach for the Cincinnati Reds, Philadelphia Phillies, and St. Louis Cardinals. McRae, who won a World Series ring playing for Kansas City against the Cardinals in 1985, won a ring as a coach for the Cardinals when they defeated the Detroit Tigers in the 2006 World Series, four games to one.