Like Rockne before him, Layden was a goodwill ambassador for Notre Dame. He was able to schedule a home-and-home series with Michigan after meeting with Fielding H. Yost, healing a rift between the two schools. The two teams had not met since 1909, when, after eight straight losses to the Wolverines, the Irish posted their first win. They were scheduled to meet again in 1910, but Michigan canceled the game and refused to play the Irish again. By the time they met again in 1942–43, Layden had left Notre Dame and Frank Leahy had taken his place. Unlike the easygoing Layden, Leahy was intense, and after the Irish had thrashed Michigan by a score of 35–12 in 1943, Wolverine coach and athletic director Fritz Crisler never scheduled the Irish again.

Layden was born in Davenport, Iowa, where he attended Davenport High School, now Davenport Central High School. At Notre Dame, he played fullback alongside quarterback Harry Stuhldreher, left halfback Jim Crowley, and right halfback Don Miller; the four collectively earned the nickname of “The Four Horsemen of Notre Dame” from legendary sportswriter Grantland Rice, and are still considered one of the best backfields in college football history. Named an All-American during his senior year, Layden culminated his collegiate career in the 1925 Rose Bowl against Stanford, returning two interceptions for touchdowns in Notre Dame’s 27–10 victory. The Four Horsemen were reunited for a professional football game in 1925 by the Hartford Blues as they played the Cleveland Bulldogs. The game though resulted in a 13–6 Hartford loss, with the Blues reportedly spending $5,000 on the Horsemen for just one game.

Also in 1934, he became head coach and athletic director at Notre Dame, three years after his legendary mentor Knute Rockne was killed in an airplane crash on March 31, 1931.

In 1941, the National Football League franchise owners voted to change the league’s constitution in an attempt to bring all professional football leagues under the authority of one commissioner, who would have similar powers to that of Commissioner of Baseball Kenesaw Mountain Landis. Chicago Tribune journalist Arch Ward was offered the position of commissioner, but he turned it down and suggested Elmer Layden for the position.

Layden was appointed commissioner in February 1941. His appointment was not voted on by the entire league, which upset owners Alexis Thompson, Bert Bell, and Dan Topping. Chicago Bears owner George Halas contended that Layden’s hiring was legal because it had been agreed upon by a majority of owners. Layden was signed to a five-year contract with an annual salary of $20,000.

Layden’s tenure as NFL commissioner came to an end in January 1946. After Brooklyn owner Dan Topping withdrew his team from the league to join the new All-America Football Conference, the remaining owners agreed not to renew Layden’s contract, feeling that he was too much of a gentleman and not forceful enough. Layden was succeeded by Bert Bell.

After leaving the NFL, Layden embarked on a successful business career in Chicago, where he died at the age of 70. He was inducted into the College Football Hall of Fame in 1951 as a charter member.