He graduated from West Point in 1882.
He entered the Ordnance Department in 1890. He retired from active service in 1914 as a colonel, but was recalled as chief of the Small Arms Division of Ordnance during World War I and was promoted to brigadier general in 1918. At the end of the war he retired again and entered business.
During his years of active service Thompson invented a number of semiautomatic rifles, but none of these proved successful. In 1920, however, the Thompson machine gun, or "Tommy gun, " was developed and marketed. This was a 45-cal. submachine gun, weighing about 10 pounds (4. 5 kg), with full automatic or semiautomatic fire, and was among the first of its type to be made in the United States.