Nelson was born on May 8, 1940, in Teaneck, New Jersey. He was the second son of entertainment couple Harriet Hilliard Nelson (born Peggy Lou Snyder; July 18, 1909 - October 2, 1994) and Ozzie Nelson (March 20, 1906 - June 3, 1975). His father Ozzie was half Swedish. The Nelsons' older son was actor David Nelson (October 24, 1936 - January 11, 2011).

In 1972, Nelson reached the Top 40 one last time with "Garden Party", a song he wrote in disgust after a Richard Nader Oldies Concert at Madison Square Garden where the audience booed him, because, he felt, he was playing new songs instead of just his old hits. When he performed The Rolling Stones' "Honky Tonk Women", he was booed off the stage. He was watching the rest of the performance on a TV monitor backstage until Richard Nader finally convinced Nelson to return to the stage and play his "oldies". He returned to the stage and played his "oldies" and the audience responded with applause, according to Deborah Nader, President of Richard Nader Entertainment. He wanted to record an album featuring original material, but the single was released before the album because Nelson had not completed the entire Garden Party album yet. "Garden Party" reached #6 on the Billboard Hot 100 and #1 on the Billboard Adult Contemporary chart and was certified as a gold single. The second single released from the album was "Palace Guard" which peaked at #65. Nelson was with MCA at the time, and his comeback was short-lived. Nelson's band soon resigned, and MCA wanted Nelson to have a producer on his next album. A new band was formed by Lindy Goetz, then a promotion person at MCA Records. Nelson's band moved to Aspen and changed their name to "Canyon". Nelson and the new Stone Canyon Band began to tour for the Garden Party album. Nelson still played nightclubs and bars, but he soon advanced to higher-paying venues because of the success of Garden Party. In 1974 MCA was at odds as to what to do with the former teen idol. Albums like Windfall failed to have an impact. Nelson became an attraction at theme parks like Knott's Berry Farm and Disneyland. He also started appearing in minor roles on television shows. Nelson tried to score another hit but did not have any luck with songs like "Rock and Roll Lady." With seven years to go on his contract, MCA dropped him from the label.

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