O. Henry was born William Sydney Porter in Greensboro, North Carolina. His father, Algernon Sidney Porter, was a physician. When William was three, his mother died, and he was raised by his parental grandmother and paternal aunt. William was an avid reader, but at the age of fifteen he left school and then worked in a drug store and on a Texas ranch. He continued to Houston, where he had a number of jobs, including that of bank clerk. After moving in 1882 to Texas, he worked on a ranch in LaSalle County for two years. In 1887 he married Athol Estes Roach; they had one daughter and one son.
"It was beautiful and simple as all truly great swindles are." (from The Octopus Marooned)
In 1894 Porter started a humorous weekly The Rolling Stone. It was at this time that he began heavy drinking. When the weekly failed, he joined the Houston Post as a reporter and columnist. In 1894, cash was found to have gone missing from the First National Bank in Austin, where Porter had worked as a bank teller. When he was called back to Austin to stand trial, Porter fled to Honduras. Little is known about Porter's stay in Central America. It is said that he met one Al Jennings and rambled in South America and Mexico on the proceeds of Jennings' robbery. After hearing news that his wife was dying, he returned in 1897 to Austin. In 1897 he was convicted of embezzling money, although there has been much debate over his actual guilt. Porter entered a penitentiary in 1898 at Columbus, Ohio.
While in prison, Porter started to write short stories to earn money to support his daughter Margaret. His first work, Whistling Dick's Christmas Stocking (1899), appeared in McClure's Magazine. The stories of adventure in the U.S. Southwest and in Central America gained an immediately success among readers. After doing three years of the five year sentence, Porter emerged from the prison in 1901 and changed his name to O. Henry. According to some sources, he acquired the pseudonym from a warder called Orrin Henry. It also could be an abbreviation of the name of a French pharmacist, Eteinne-Ossian Henry, found in the U.S. Dispensatory, a reference work Porter used when he was in the prison pharmacy.
O. Henry moved to New York City in 1902, and from December 1903 to January 1906 he wrote a story a week for the New York World, also publishing in other magazines. Henry's first collection, Cabbages and Kings,, appeared in 1904. The second, The Four Million, was published two years later and included his well-known stories The Gift of the Magi and The Furnished Room.
The Trimmed Lamp (1907) explored the lives of New Yorkers and included The Last Leaf. In one of his stories, One Dollar's Worth, O. Henry deals with the judicial system. Judge Derwent receives a letter from an ex-convict, in which the writer, 'Rattlesnake,' threatens the Judge's daughter and the district attorney, Littlefield. A young Mexican, Rafael Ortiz, is accused of passing a counterfeit silver dollar, made principally of lead. Rafael's girl, Joya TreviÃ±as, tells Littlefield that he is innocent - she was sick and needed medicine, and that was the reason why Rafael used the dollar. Littlefield refuses to help, and Joya says that "it the life of the girl you love is ever in danger, remember Rafael Ortiz." When he drives out of the town with Nancy Derwent, they meet Mexico Sam, the writer of the letter. He starts to shoot them from distance with his rifle. Littlefield can't hurt him with his own gun, as it only has tiny pellets. He then remembers Joya's words, and manages to hit Mexico Sam, who falls from his horse dead as a rattlesnake. Next morning in the court: "'I shot him,' said the district attorney, 'with Exhibit A of your counterfeiting case. Lucky thing for me - and somebody else - that it was as bad money as it was! It sliced up into slugs very nicely. Say, Kil, can't you go down to the jacals and find where that Mexican girl lives? Miss Derwent wants to know.'"
Henry's best known work is perhaps the much anthologized The Ransom of Red Chief, published in the collection Whirligigs in 1910. O. Henry's humorous, energetic style shows the influence of Mark Twain and Ambrose Bierce. The story is about two kidnappers who make off with the young son of a prominent man. They find out that the child is a real nuisance. In the end they agree to pay the boy's father to take him back. - "Sam," says Bill, "I suppose you'll think I'm a renegade. But I couldn't help it. I'm a grown person with masculine proclivities and habits of self-defense, but there is a time when all systems of egotism and predominance fail. The boy is gone. I sent him home. All is off. There was martyrs in old times," goes on Bill, "that suffered death rather than give up the particular graft they enjoyed. None of 'em ever was subjugated to such supernatural tortures as I have been. I tried to be faithful to our articles of depredation; but there came a limit."
Heart of the West (1907) presented western stories. J. Frank Dobie named The Last of the Troubadours "the best range story in American fiction." The Caballero's Way featured a character called 'the Cisco Kid.'
During his life time, O. Henry published ten collections and over six hundred short stories. His last years were shadowed by alcoholism, ill health, and financial problems. He was a fast writer, like the Russian Anton Checkhov (1860-1904), but drinking on average two quarts of whiskey daily did not improve the quality of his work. In 1907 O. Henry married Sara Lindsay Coleman, also born in Greensboro. The marriage was not happy, and they separated a year later. O. Henry died of cirrhosis of the liver on June 5, 1910, in New York. Three more collections, Sixes and Sevens (1911), Rolling Stones (1912) and Waifs and Strays (1917), appeared posthumously.
In 1918 the O. Henry Memorial Awards were established to be given annually to the best magazine stories, with the winners and leading contenders to be published in an annual volume.