Walters began his career as an apprentice at Aston Villa on leaving school in the summer of 1980, turning the professional a year later – just after Villa's Football League First Division title triumph – and made his competitive debut on 28 April 1982 in a 4–1 league defeat at home to Leeds United, two months after the departure of manager Ron Saunders – who had given Walters his first professional contract – and the promotion of assistant Tony Barton to the manager's seat. Walters was not included in Villa's squad for the final of the European Cup on 26 May 1982, which they won 1–0 against Bayern Munich, the West German champions. Walters, still only 18, made 22 league appearances in the 1982–83 campaign as Villa finished sixth. He scored once that season. He was firmly established as a regular player in the 1983–84 season, appearing 37 times in the league and scoring eight goals, though Villa had a disappointing season and finished 10th, with Tony Barton being sacked at the end of the season and replaced by Graham Turner.