Potts graduated summa cum laude from Georgia Institute of Technology in Atlanta with a degree in physics before attending film school at the University of California at Los Angeles. His first professional position was as first assistant director on the 1972 film of the ballet Don Quixote, which starred his then-lover Rudolf Nureyev. He worked in a number of production positions for various directors before venturing into independent film-making with the 1976 film More, More, More. Potts was the research archivist for the Rudolf Nureyev Foundation in Bath, UK from 1993 until his death. During his tenure with the Foundation, he was able to collect the major bulk of Nureyev's work on film and video, and arranged for the collection to be housed at the New York Public Library and at the Centre Nationale de la Danse in Paris.
Wallace Potts died in Los Angeles, California, on June 29, 2006, of lymphoma.