Phelan was born in Stoughton, Massachusetts, to Dan and Bonnie Phelan. He moved to Houston, Texas, with his mother and grandmother Beverly at the age of seven. He began his acting career in various stage productions at the Unicorn Theatre in Houston at age 9. His first national television role was in an episode of the NBC sitcom Sister Kate in 1989 at the age of 13 and followed by small roles in television series such as The Wonder Years, Family Matters and Grand. His first studio film role was in the 1991 drama Toy Soldiers opposite actors Sean Astin, Wil Wheaton and Louis Gossett Jr.