Butz met the former Mary Emma Powell (1911–1995) from North Carolina in 1930, at the National 4-H Camp in Washington, DC. They were married on December 22, 1937. They had two sons, William Powell and Thomas Earl Butz.

Butz was an alumnus of Purdue University, where he was a member of Alpha Gamma Rho fraternity. He received a bachelor of science degree in agriculture in 1932, and then a doctorate in agricultural economics in 1937. He was the uncle of American football player Dave Butz.

In 1948, Butz became vice president of the American Agricultural Economics Association, and three years later was named to the same post at the American Society of Farm Managers and Rural Appraisers. In 1954, he was appointed Assistant Secretary of Agriculture by President Dwight D. Eisenhower. That same year, he was also named chairman of the United States delegation to the Food and Agriculture Organization of the United Nations.

He left both of the aforementioned posts in 1957, when he became the Dean of Agriculture at his alma mater, Purdue University. In 1968, he was promoted to the positions of Dean of Education and vice president of the university’s research foundation. In 1968, he also ran for Governor of Indiana, but came in a distant third at the Republican state convention to eventual winner Edgar Whitcomb and future governor Otis R. Bowen.

Butz was Assistant Secretary of Agriculture in Washington, DC, from 1954 to 1957 under President Dwight Eisenhower. In 1971, President Richard Nixon appointed Butz as Secretary of Agriculture, a position in which he continued to serve after Nixon resigned in 1974 as the result of the Watergate scandal. He was Secretary of Agriculture from 1971 to 1976 under presidents Richard Nixon and Gerald Ford. In his time heading the USDA, Butz drastically changed federal agricultural policy and re-engineered many New Deal-era farm support programs.

Butz took over the Department of Agriculture during the most recent period in American history that food prices climbed high enough to generate political heat. In 1972, the Soviet Union, suffering disastrous harvests, purchased 30 million tons of American grain. Butz had helped to arrange that sale in the hope of giving a boost to crop prices to bring restive farmers tempted to vote for George McGovern into the Republican fold.

At the 1974 World Food Conference in Rome, Butz made fun of Pope Paul VI’s opposition to “population control” by quipping, in a mock Italian accent: “He no playa the game, he no maka the rules.” A spokesman for Cardinal Cooke of the New York archdiocese demanded an apology, and the White House requested that he apologize. Butz issued a statement saying that he had not “intended to impugn the motives or the integrity of any religious group, ethnic group or religious leader.” Through a spokesman, he stated that media outlets had taken this portion of his statement out of their original context, which was that of retelling a joke.

Butz resigned his cabinet post on October 4, 1976, after a second gaffe:

The Associated Press sent the uncensored quotation over the wire, but the Columbia Journalism Review identified only two city newspapers—the Toledo Blade (Toledo, Ohio) and the Madison Capital Times (Madison, Wisconsin)—that published the remark unchanged. Others bowdlerized the quote, in some cases replacing the female genital reference with “a tight [obscenity]” and the scatological reference with “a warm place to [vulgarism]” or “warm toilet seats”. The Lubbock Avalanche-Journal said the original statement was available in the newspaper office; more than 200 stopped by to read it. The San Diego Evening Tribune offered to mail a copy of the whole quotation to anyone who requested it; more than 3,000 readers did. The quotation was among the inspirations behind the comedy film Loose Shoes, particularly the sketch “Dark Town After Dark,” made in 1977 but released in 1980.

On May 22, 1981, Butz pleaded guilty to federal tax evasion charges for having under-reported income he earned in 1978. On June 19, he was sentenced to five years in prison. All but 30 days of the term were suspended. He was also fined $10,000 and ordered to pay $61,183 in civil penalties.

Butz continued to serve on corporate boards and speak on agricultural policy. At an international conference in Geneva, Switzerland (sponsored by the Agri-Energy Roundtable (AER) on May 23, 1983, Butz warned his audience (concerning ethanol production and subsidies), “Those who ride the Tiger may find dismounting difficult”. A number of those present had represented their countries during the famous 1974 World Food Security Summit (Rome) where Butz had led the US delegation.

Butz died in his sleep on February 2, 2008, in Kensington, Maryland. He is buried at the Tippecanoe Memory Gardens in West Lafayette, Indiana.