Clarence Douglas Dillon was born in Geneva, Switzerland on April 21, 1909, and was educated at the Groton School and Harvard. Before entering government service in 1953, Dillon was an investment banker. He was a member of the New York Stock Exchange from 1931 to 1936 prior to becoming director and eventual president of the U.S. and Foreign Securities Corporation. In 1938, he was appointed the vice president and director of the Dillon, Read Company, and was elected chairman of the board in 1946. He served in the Navy during World War II and received decorations for combat service. President Eisenhower appointed him ambassador to France in 1953; four years later, Dillon became deputy undersecretary of state for economic affairs.

In 1958, he was promoted to undersecretary of state for economic and agricultural affairs before rising, in 1959, to the position of undersecretary of state. While at the State Department, he cofounded the Inter-American Development Bank, headed the U.S. delegation to the Committee of 21 of the Organization of American States, completing the Act of Bogotá, and headed the delegation to the Ministerial Meeting in Paris, where the final form of the Convention for the Organization for Economic Cooperation and Development was completed.

In 1961, despite his Republican background, Dillon was appointed to Kennedy's cabinet as the secretary of the treasury. He served both Kennedy and Johnson in that capacity until 1965. Dillon was the most influential member of Kennedy's economic advisors; among his accomplishments was his ability to convince President Kennedy that the nation's most pressing economic problem was the balance of payments deficit. Dillon's influence prevented the Kennedy administration from using more daring liberal solutions to solve domestic problems, however.

After serving as secretary of the treasury, he served as the chairman of the U.S. and Foreign Securities Corporation from 1967 to 1984, director of the Council on Foreign Relations from 1965 to 1978, and vice chairman of the council from 1977 to 1978. He was on the Board of Overseers for Harvard College from 1968 to 1972, served as the Chairman of the Rockefeller Foundation from 1971 to 1975, and was chairman of the Brookings Institution from 1971 to 1975. In addition to his involvement in government and finance, Dillon also served as the president of the Metropolitan Museum of Art from 1970 to 1977 and as chairman from 1977 to 1983.