Arnold was born at Hobart, Tasmania, on 18 September 1852, eldest son and second child of Thomas Arnold; his mother was Julia, daughter of William Sorell, registrar of deeds, Hobart, and his elder sister was the novelist Mrs. Humphry Ward.
Spinal disease compelled Arnold's retirement from the Manchester Guardian in 1898, and next year he moved to London, where he saw friends and wrote a little.