Hiley was the son of a British Army and came with twelve years to England to attend school. He studied at King's College London, where he received his doctorate in 1962 in theoretical solid state physics at Cyril Domb and Michael E. Fisher. In 1961 he was Assistant Lecturer at Birkbeck College, University of London, where Professor David Bohm was shortly before. It began a decade- long collaboration with Bohm and its alternative interpretation of quantum mechanics, which culminated in the book The Undivided Universe 1993. In 1995 he became a professor at Birkbeck College.
In the search for an alternative interpretation of quantum mechanics with Bohm Hiley pursued in particular the construction of algebraic theories ( Cliffordalgebren ), as a kind of pre- geometry in the sense of John Archibald Wheeler (who for the quantization of gravity already in the 1950s the need for a moving away saw from the description in the space-time frame) from which later a space-time description of results. He and Bohm relate natural-philosophical considerations and socialize with one based on processes pre- geometry in his own words to philosophical ideas of Alfred North Whitehead to. The quantum potential in the Bohm interpretation, that there is a source of non-locality, Bohm and Hiley interpreted as active information and see this as the basis of a common treatment of matter and spirit.
In 2012 he received the Majorana price.