Jordan was born Edmund Patrick Jordan at the Wentworth Nursing Home in Dublin on 30 March 1948, the son of Eileen and Paddy Jordan. He has one older sibling, Helen. His father was the twin brother of a senior nun, Mother Rectoress of the Irish Sisters of Charity and worked as an accountant for the electricity board. At ten months old, Jordan developed a form of pink disease and his family were advised by doctors to move from Dublin to Bray for "fresh air". His mother Eileen was advised to "take him out of woollens and into cotton during the month of May", advice she opposed, initially. Nevertheless, she conceded and Jordan's condition did gradually improve. During his childhood, Jordan grew up in Dartry, south Dublin and Bray, County Wicklow. He spent most of his time in Bray, where he became close with his Aunt Lilian, having regularly travelled to visit her at the end of the school week. In his childhood, Jordan was known by the nickname "Flash" as his surname rhymed with the name Gordon.
Jordan began his education at Saint Anne's Pre-School in Milltown later spending eleven years at the Synge Street Christian Brothers School, where he and his fellow students would be regularly beaten if they did not study hard. Despite this experience, Jordan found the level of education to be high. While at Synge Street, aged 15, Jordan briefly considered becoming a priest. Having dismissed the priesthood and family pressures to enter dentistry, he ended up taking a six-week accountancy course at the College of Commerce, Dublin, and then began working for the Bank of Ireland as a clerk at their branch in Mullingar. After four years, Jordan moved to the branch in Camden Street, Dublin. During a banking strike in Dublin in 1970, he spent the summer on the island of Jersey, working as an accountant for an electricity company by day and doing bar work in the evenings. During this period, he encountered kart racing for the first time, and had his first (unofficial) races there at St Brelade's Bay.
Upon his return to Dublin, Jordan bought a kart and began racing. He entered the Irish Kart Championship in 1971 and won it.
In 1974 Jordan moved up to Formula Ford, the Irish Formula Ford Championship and in 1975 to Formula Three, but was forced to sit out the 1976 season after shattering his left leg in a crash at Mallory Park. After his injuries had healed, he switched to Formula Atlantic, won three races in 1977, and won the Irish Formula Atlantic Championship in 1978. Jordan and Stefan Johansson raced in British Formula Three in 1979, under the name "Team Ireland" and, in the same year, Jordan drove in one Formula Two race and did a small amount of testing for McLaren.
At the end of 1979 and short of money, Jordan founded his first team, Eddie Jordan Racing, which ran drivers David Leslie and David Sears in 1981 at various events in and around Great Britain. In 1982 his primary driver was James Weaver; in 1983 Weaver ran again in European F3 and Jordan hired Martin Brundle, who finished second to Ayrton Senna in British F3. In 1987 the team employed Johnny Herbert, who proceeded to win the British Formula Three Championship.