James William Fulbright was born in Sumner, Missouri, in 1905, the fourth of six children. His parents, Jay and Roberta Waugh Fulbright, were both descended from moderately well-to-do families and graduates of the University of Missouri. Jay inherited land from his father, a rough-hewn, harddriving sort, but opted for a career in business, specifically, banking. In 1906 Jay settled his family in Fayetteville, Arkansas, a community of some three thousand souls nestled in the foothills of the Ozark Mountains and the site of the state university. During the next twenty years the patriarch of the Fulbright family built a small business empire, including a dry goods store, a lumber company, a bottling enterprise, a bank, the local newspaper, and numerous properties. Meanwhile, the gregarious Roberta carved out a niche in Fayetteville society, presiding over frequent soirees made up of prominent townspeople and faculty and administrators from the University of Arkansas.

To all of his friends and family James William Fulbright was never anything but “Bill.” He was an intense, active child with an abundance of physical and psychological energy. Sticklers for education, Jay and Roberta decided to enroll Bill in the experimental grammar and secondary school operated by the university's College of Education. One of young Fulbright's classmates, Marguerite Gilstrap, recalled that the teachers at Peabody Experimental School were much influenced by the theories of educational pioneer John Dewey. Students were assigned material to master; in class they sat in embarrassed silence until they began to ask questions. The emphasis was on self-reliance and intellectual assertiveness.