Penslar was educated at Stanford University and the University of California at Berkeley. He taught at Indiana University between 1987 and 1998, when he moved to the University of Toronto. Between 2012 and 2016 Penslar taught at Oxford University, where he served as the inaugural Stanley Lewis Professor of Modern Israel Studies. He is co-editor of The Journal of Israeli History, a Fellow of the Royal Society of Canada, and President of the American Academy for Jewish Research.
Penslar's books include Zionism and Technocracy: The Engineering of Jewish Settlement in Palestine, 1870-1918 (1991); In Search of Jewish Community: Jewish Identities in Germany and Austria, 1918-1933 (1998, co-edited with Michael Brenner), Shylock’s Children: Economics and Jewish Identity in Modern Europe (2001); Orientalism and the Jews (co-edited with Ivan Kalmar, 2004), Israel in History: The Jewish State in Comparative Perspective (2006); The Origins of the State of Israel 1882-1948: A Documentary History (with Eran Kaplan, 2011). and Jews and the Military: A History (2013), and Theodor Herzl: The Charismatic Leader (2020). He is currently writing a book titled Zionism: An Emotional State for Rutgers University Press’ series on “Keywords in Jewish Studies.”