Kazan was born Elias Kazancoglu (Ηλίας Καζαντζόγλου Greek) to Greco-Armenian parents in Kayseri, Turkey. His family emigrated to the United States in 1913 and settled in New York City, where his father, George Kazanjoglu, became a rug merchant. Kazan's father expected that his son would go into the family business, but his mother, Athena (née Sismanoglou), encouraged Kazan to make his own decisions.
Kazan attended public schools in New York City and New Rochelle, New York. After graduating from Williams College in Massachusetts, Kazan studied at Yale University's School of Drama. In the 1930s, Kazan acted with New York's Group Theatre, alongside (among others) Lee Strasberg, Clifford Odets, and Stella and Luther Adler. During this period, Kazan earned his nickname 'Gadg', short for Gadget - he never learned to love the name. For about 19 months in 1934-36, Kazan was a member of a secret Communist cell.