Born in New York City to a Judge of Special Sessions who was also president of a sewing machine company. Grew up on City Island, New York. Attended Hamilton Military Academy and turned down an appointment to West Point to attend New York University where his law school classmates included future New York City mayor James J. Walker. After a boating accident which led to pneumonia, Carey wrote a play while recuperating and toured the country in it for three years, earning a great deal of money, all of which evaporated after his next play was a failure. In 1911, his friend Henry B. Walthall introduced him to director D.W. Griffith, for whom Carey was to make many films.

Carey then became one of the great stars of the Biograph Company making many films, including the first in depth gangster film "Muskateers Of Pig Alley", which director Martin Sccosese says influenced him in the making of"Goodfellas", and "Gangs Of New York". Carey married twice, the second time to actress Olive Fuller Golden (aka Olive Carey, who introduced him to future director John Ford. Carey influenced Universal Studios head Carl Laemmle to use Ford as a director, and a partnership was born that lasted until a rift in the friendship in 1921.