Dixon hailed from Nantucket, Massachusetts. His family later moved to Harlem, New York City when he was about 7. His studies in music came relatively late in life, at the Hartnette Conservatory of Music (1946–1951). He studied painting at Boston University and the WPA Arts School and the Art Students League. During the early 1950s he had a job at the United Nations, and founded the UN Jazz Society.
In the 1960s Dixon established himself as a major force in the jazz avant-garde movement. In 1964, Dixon organized and produced the 'October Revolution in Jazz', four days of music and discussions at the Cellar Café in Manhattan. The participants included notable musicians Cecil Taylor and Sun Ra among others. It was the first free-jazz festival of its kind. Dixon later founded the Jazz Composers Guild, a cooperative organization that sought to create bargaining power with club owners and effect greater media visibility. He was relatively little recorded during this period, though he co-led some releases with Archie Shepp and appeared on Cecil Taylor's Blue Note record Conquistador! in 1966.
He was Professor of Music at Bennington College, Vermont, from 1968 to 1995, where he founded the college's Black Music Division. From 1970 to 1976 he played "in total isolation from the market places of this music", as he puts it. Solo trumpet recordings from this period were later released by Cadence Jazz Records, and later collected on the self-released multi-CD set Odyssey along with other material.
He was one of four featured musicians in the Canadian documentary Imagine the Sound (along with Cecil Taylor, Archie Shepp, and Paul Bley), 1981.
In recent years he recorded with Cecil Taylor, Tony Oxley, William Parker, Rob Mazurek, and many others.
On June 16, 2010, Bill Dixon died in his sleep at his home after suffering from an undisclosed illness.
Soul Note Records1980: Bill Dixon in Italy volumes 1 & 2 with Alan Silva, Freddie Waits
1981: November 1981 with Silva, Laurence Cook, Mario Pavone
1985: Thoughts with Peter Kowald
1988: Son of Sisyphus
1994: Vade Mecum volumes 1 & 2
1999: Papyrus volumes 1 & 2
Other labels1962: Archie Shepp - Bill Dixon Quartet (Savoy)1964: Bill Dixon 7-tette/Archie Shepp and the New York Contemporary 5 (Savoy, split LP)
1967: Intents and Purposes (RCA)
1981: Considerations 1 & 2 (Fore)
1984: Collection (Cadence)
1999: Berlin Abbozzi (Free Music Production) with Matthias Bauer, Klaus Koch, Tony Oxley
2001: Odyssey (Archive Editions)
2007: 17 Musicians in Search of a Sound (Aum Fidelity)
2008: Bill Dixon with Exploding Star Orchestra (Thrill Jockey)
2009: Tapestries for Small Orchestra (Firehouse 12)
2011: Envoi (Victo)