Kenneth Macgowan began his career as a drama critic. He wrote many books on the modern theater including The Theatre of Tomorrow (1921) and Continental Stagecraft (1922), the latter with Robert Edmond Jones. In 1922, he ran The Provincetown Playhouse as its producer, with Eugene O'Neill and Robert Edmond Jones as partners. His close relationship with O'Neill lasted their lifetimes.
In 1928 he moved to Hollywood, California to become a story editor for RKO Radio Pictures. By 1932, Macgowan had become a producer for RKO, including Little Women (1933) starring Katharine Hepburn.
Macgowan produced many films between 1932 and 1947, not only at RKO, but also for 20th Century Fox and Paramount Pictures. He produced the first color picture, Becky Sharp (1935), Young Mr. Lincoln with Henry Fonda (1939), and Alfred Hitchcock's Lifeboat (1944).
In 1946, he left from the industry to become the first chair of the Department of Theater Arts at UCLA. The theater building on the school's campus is named in his honor.
Throughout his life, he wrote books on a number of subjects including drama and film, most notably Behind the Screen, a history of cinema published in 1965 after his death.
He died on 27 April 1963, in West Los Angeles, California.