Thoby Stephen was the eldest son of Leslie Stephen and Julia Prinsep. As the result of his mother's previous marriage he was also a half-brother of George and Gerald Duckworth. He was educated at Clifton College, after failing to gain a place at Eton. However, this did not hold him back, since he won an exhibition to Trinity College, Cambridge, from Clifton. He was a friend of Lytton Strachey, who was enchanted by his masculinity and introduced him to the "Reading Club". He was described as "over six feet tall and of somewhat ponderous build".
He was expected to distinguish himself, but he contracted typhoid at the age of 26 while on holiday in Greece, and died shortly after he was brought back to England.