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De la Mare was born in Kent at 83 Maryon Road, Charlton (now part of the Royal Borough of Greenwich), partly descended from a family of French Huguenots, and was educated at St Paul's Cathedral School. He was born to James Edward de la Mare, a clerk at the Bank of England, and Lucy Sophia Browning (James' second wife), daughter of Scottish naval surgeon and author Dr Colin Arrott Browning. The assertion that Lucy was related to poet Robert Browning has been found to be incorrect. He had two brothers, Francis Arthur Edward and James Herbert ('Bert'), and four sisters Florence Mary, Constance Eliza, Ethel (who died in infancy), and Ada Mary ('Poppy'). De la Mare was known as Jack by his family and friends as he hated the name Walter.

In 1892, de la Mare joined the Esperanza Amateur Dramatics Club, where he met and fell in love with Elfrida (Elfie) Ingpen, the leading lady, who was ten years older than he. She was pregnant when they were married on 4 August 1899. They went on to have 4 children: Richard Herbert Ingpen ('Dick'), Colin, Florence and Lucy Elfrida ('Jinnie') de la Mare. Their house at Anerley in south London was the scene of many parties, notable for imaginative games of charades.

De la Mare's first book, Songs of Childhood, was published under the name Walter Ramal. He worked in the statistics department of the London office of Standard Oil for eighteen years while struggling to bring up a family, but nevertheless found time to write. In 1908, through the efforts of Sir Henry Newbolt he received a Civil List pension which enabled him to concentrate on writing.

In 1940, Elfie was diagnosed with Parkinson's disease and spent the rest of her life as an invalid, eventually dying in 1943. From 1940 until his death, de la Mare lived in South End House, Montpelier Row, Twickenham, the same street where Alfred, Lord Tennyson had lived a century earlier. For the Collected Stories for Children (Faber & Faber, 1947), he won the annual Carnegie Medal from the Library Association, recognising the year's best children's book by a British subject.It was the first collection to win the award.

De la Mare suffered from a coronary thrombosis in 1947 and died of another in 1956. His ashes are buried in the crypt of St Paul's Cathedral, where he had once been a choirboy.