Stephen was the eldest son of the Hon. Sir Alfred Stephen, G.C.M.G., ex-Lieut.-Governor of New South Wales and was born at Hobart, Van Diemen's Land (later named Tasmania). He was called to the New South Wales Bar in 1850, and became Q.C. He was a member of the New South Wales Legislative Assembly for Mudgee from December 1869 to December 1871, and was a Puisne Judge of the Supreme Court of New South Wales from 1887. He married on 30 September 1854, Caroline Sibella, daughter of Henry Tudor Shadforth, formerly of the 57th Regiment, and Usher of the Black Rod, New South Wales. Judge Stephen was Chancellor of the Church of England diocese of Sydney.
Stephen was senior vice-president of the New South Wales Cricket Association and from 1895, was a fellow of the Royal Colonial Institute. Stephen died at Bellevue Hill, Sydney, New South Wales, Australia on 1 April 1920, survived by his second wife (Florence Sophie, née Huthwaite) and by Caroline, his only daughter from his first marriage.
- "Sir Matthew Henry STEPHEN (1828 - 1920)". Parliament of New South Wales.
- Mennell, Philip (1892). " Stephen, His Honour Matthew Henry". The Dictionary of Australasian Biography. London: Hutchinson & Co. Wikisource
- Rutledge, Martha. "Stephen, Sir Matthew Henry (1828–1920)". Australian Dictionary of Biography. Canberra: Australian National University. Retrieved 17 September 2013.