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Greene is an Oneida, born in Ohsweken on the Six Nations Reserve in Ontario, the son of Lillian and John Greene, who was an ambulance driver and maintenance man. He lived in Hamilton, Ontario as a young adult. Greene's first brushes with the entertainment industry came when he was an audio technician for rock bands. He graduated from The Centre for Indigenous Theatre's Native Theatre School program in 1974, and began appearing in theater in Toronto and England.

Greene's TV debut was in an episode of "The Great Detective" in 1979 and his screen debut was in 1983 in Running Brave, and appeared in such films as Revolution and Powwow Highway, but it was his Academy Award nominated role Kicking Bird in the 1990 film Dances with Wolves that brought him stardom. This role was followed by such films as Thunderheart, Benefit of the Doubt, and Maverick, and the television series Northern Exposure and The Red Green Show. He also hosted the reality crime documentary show Exhibit A: Secrets of Forensic Science.

In 1992, he played the role of Ishi the last Yahi in the HBO drama The Last of His Tribe. In 1994, he began appearing as Mr. Crabby Tree in the children's series The Adventures of Dudley the Dragon for which he received his first, and so far only Gemini Award. In 1997, Greene suffered a major depressive attack, and had to be hospitalized after a police encounter. He survived the ordeal, and subsequently was featured as Arlen Bitterbuck, a Native American on death row in the Oscar-nominated The Green Mile (1999). He starred in the short-run television series Wolf Lake in 2001. In 2004, he accepted the Earle Grey Award for lifetime achievement at the Gemini Awards.

In 2005, he re-emerged as the potential love interest of a pre-operative transsexual woman in Transamerica. He also appeared as himself in a parody of the famous Lakota-brand pain reliever commercials, on CBC Television's Rick Mercer Report. In 2006, Greene was the presenter of the documentary series The War that Made America about the French and Indian War of the mid-18th century. In the same year, the Stratford Theatre Festival of Canada announced that Greene would be taking leading roles in their 2007 productions of The Merchant of Venice and Of Mice and Men

Greene provides the pre-recorded narration for the highly acclaimed outdoor drama, Tecumseh! in Chillicothe, Ohio, based upon the life of the famous Shawnee chief, Tecumseh. Greene also portrayed the famous Sioux leader Sitting Bull in a short Historica vignette

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