During the early 1950s, Bethe also played an important role in the development of the larger hydrogen bomb, though he had originally joined the project with the hope of proving it could not be made. Bethe later campaigned together with Albert Einstein in the Emergency Committee of Atomic Scientists against nuclear testing and the nuclear arms race. He influenced the White House to sign the ban of atmospheric nuclear tests in 1963 and the 1972 Anti-Ballistic Missile Treaty, SALT I. His scientific research never ceased even into the later years of his life. He is one of the few scientists who can claim a major paper in his field every decade of his career, which spanned nearly sixty years. Freeman Dyson called Bethe the "supreme problem solver of the 20th century."

Bethe was born in Strasbourg, Germany, from 1871 to 1919 and 1940 to 1945 part of the German Reich. Although his mother was Jewish, he was raised in the religion of his father, Christianity. Bethe studied physics at JWG University, Frankfurt, and went on to earn his doctorate from the University of Munich with supervisor Arnold Sommerfeld, after which he did postdoctoral stints in Cambridge and at Enrico Fermi's laboratory in Rome. He was influenced by Fermi's simplicity and Sommerfeld's rigor in approaching problems, and these qualities influenced his own later research.

Bethe left Germany in 1933 when the Nazis came to power and he lost his job at the University of Tübingen, moving first to England where he held a provisory position of Lecturer for the year 1933-1934 at the University of Manchester and in the fall of 1934, a fellowship at the University of Bristol. In England, Bethe worked with the theoretician Rudolf Peierls on a comprehensive theory of the deuteron. In 1929, Bethe made an important contribution to solid state physics and chemistry, with his formulation of the basic concepts of crystal field theory. His paper is regarded as the starting point for all serious later discussions of the topic. In 1930, he devised a formula for the energy loss of swift charged particles in matter called the Bethe formula, which is as important now as it was then.

In 1935 Bethe moved to the United States, and joined the faculty at Cornell University, a position which he occupied for the rest of his career. During 1948-1949 he was a Visiting Professor at Columbia University. At Cornell, Bethe became known as one of the leading theoretical physicists of his generation, and along with upcoming physicists such as cyclotron pioneer Milton Stanley Livingston, and later, after the war, experimentalist Robert R. Wilson and theoretician Robert Bacher, put Cornell on the world physics map. Together with Robert Bacher and Livingston, Bethe published a series of three articles which summarized most of what was known on the subject of nuclear physics until that time, an account that became informally known as "Bethe's Bible", and remained the standard work on the subject for many years. In this account, he also continued where others left off, filling in gaps from the older literature. From 1935-1938, he studied nuclear reactions and reaction cross sections, carbon-oxygen-nitrogen cycle, leading to his important contribution to stellar nucleosynthesis. This research was later useful to Bethe in more quantitatively developing Niels Bohr's theory of the compound nucleus.

Bethe became a naturalized citizen of the United States in 1941. He was an honorary member of the International Academy of Science.

When the war began, Bethe wanted to contribute to the war effort. Following the advice of the Caltech aerodynamicist Theodore von Karman, Bethe collaborated with his friend Edward Teller, then at George Washington University, on a theory of shock waves which are generated by the passage of a projectile through a gas. This work was later useful to researchers investigating ballistic reentry. Bethe also worked on a theory of armor penetration, which was immediately classified by the Army, making it inaccessible to Bethe, who was not an American citizen at the time.

During the summer of 1942 he served as part of a special session at the University of California, Berkeley at the invitation of Robert Oppenheimer, which outlined the first designs for the atomic bomb. Initially, Bethe was skeptical of the possibility of making a nuclear weapon from uranium. In the late 1930s, he wrote a theoretical paper arguing against fission, but was convinced by Teller to join the Manhattan Project. When Oppenheimer was put in charge of forming a secret weapons design laboratory, Los Alamos, he appointed Bethe Director of the Theoretical Division, a move that irked Teller, who had coveted the job for himself.

Bethe's work at Los Alamos included calculating the critical mass of uranium-235 and the multiplication of nuclear fission in an exploding atomic bomb. Along with Richard Feynman, he developed a formula for calculating the explosive yield of the bomb. After November 1943, when the laboratory had been reoriented to solve the implosion problem of the plutonium bomb, Bethe spent much of his time studying the hydrodynamic aspects of implosion, a job which he continued into 1944. In 1945, he worked on the neutron initiator, and later on radiation propagation from an exploding atomic bomb.

During the project, Klaus Fuchs, an English scientist spying for the Russians, was also in Bethe's division (often doing work which had originally been assigned to Teller). Like everyone else, Bethe had no knowledge that Fuchs was a spy.

When the first atomic bomb (an implosion design) was detonated in the New Mexico desert on July 16, 1945, at the Trinity test, Bethe's immediate concern was for its efficient operation, and not its moral implications. He is reported to have commented: "I am not a philosopher."[citation needed]