Nathan was born Joseph Lane on February 3, 1956, in Jersey City, New Jersey to Daniel Lane, a truck driver, and Nora Lane, a secretary. He was the youngest of three sons.
Around the time of his birth, his father's eyesight began to fail. Unemployed, the father fell victim to alcoholism and eleven years later "drank himself to death," according to Nathan.
When Nathan was in his early teens, his mother began to suffer from manic depression severe enough to require occasional hospitalization. Lane's older brother Daniel became a surrogate father to him and encouraged his love of reading and theater. He began acting while attending St. Peter's Preparatory School in Jersey City Eventually winning a drama scholarship to St. Joseph's College in Philadelphia, but even with the award, the family could not afford the expense of college, and so he began working as an actor.
As Nathan established himself in the profession by performing in dinner theater and children's productions, he supplemented his income with various jobs, including telemarketing, conducting surveys for the Harris poll, and delivering singing telegrams.
At the age of 22 Nathan registered with Actors Equity. Since there was already a performer listed as Joe Lane, he changed his first name from Joseph to Nathan after the character "Nathan Detroit" in Guys and Dolls, whom he had played in dinner theater the previous year.
Sometime later Nathan made his Broadway debut, playing "Roland Maule" in Noël Coward's Present Laughter, directed by George C. Scott. His performance met with critical approval, and he went on to appear in a number of plays, including Goldsmith's She Stoops to Conquer (1984) directed by Daniel Gerroll, Shakespeare's Measure for Measure (1985), Simon Gray's The Common Pursuit (1986-1987), and August Darnell and Eric Overmyer's A Pig's Valise (1989), as well as two unsuccessful musicals, Elmer Bernstein and Don Black's Merlin (1982-1983), and William Perry's Wind in the Willows (1985-1986).
In 1987, Nathan made his film debut playing a ghost in Hector Babenco's Ironweed, based on the novel by William Kennedy.
In 1989, Nathan played his first gay role as Mendy in Terrence McNally's The Lisbon Traviata, directed by John Tillinger. His performance earned him the Drama Desk award for best actor in a play.
In the early 1990's Nathan had roles in half a dozen films, including Frankie and Johnny (1991), which was based on a play by McNally. In it he played the gay friend of Frankie, the female lead.
In 1992, Nathan returned to Broadway in a revival of Frank Loesser's Guys and Dolls. His performance as "Nathan Detroit" earned him rave reviews and another Drama Desk award, this one for best actor in a musical, as well as a Tony nomination. The next year he was well-received as the star of Neil Simon's Laughter on the 23d Floor.
In 1994, Nathan supplied the voice of "Timon the meerkat" in Rob Minkoff's The Lion King. Nathan teamed with Ernie Sabella, who voiced a warthog, on the movie's extremely popular song "Hakuna Matata." Nathan has since been the voice of other animated characters, including a cat in the film Stuart Little (1999) and a dog in the Disney cartoon show Teacher's Pet, for which he won a Daytime Emmy award.
In 1996, Nathan played drag queen "Albert" opposite Robin Williams' "Armand" in Mike Nichols's film The Birdcage, a remake of Edouardo Molinaro's 1978 film based on Jean Poiret's play, La Cage aux Folles. The film, with a script by Elaine May and Mike Nichols, was set in Miami's South Beach. Although controversial in a number of quarters, especially for its stereotypical portrait of a gay couple, the film was a commercial success, and Nathan's performance was described as "wide-ranging and inventive."
On his personal life, Nathan has never made a secret of his homosexuality. He came out to his family when he was 21 and about to move in with a lover. He did not comment publicly on his sexual orientation until 1999, however.
He has been criticized by some activists in the gay community for waiting so long to come out publicly. In an interview in The Advocate Nathan explained that he "found it difficult to discuss his personal life with total strangers" but was moved to speak out after the murder of gay college student Matthew Shepard. "At this point it's selfish not to do whatever you can," said Nathan. "If I . . . say I'm a gay person, it might make it easier for somebody else. So it seems stupid not to."
In other interviews Nathan has alluded to an "on-again-off-again relationship with an actor who lives in Los Angeles," but has otherwise maintained privacy about his personal relationships.
Currently Nathan is appearing on Broadway opposite Matthew Broderick in the hit musical The Producers, and in 2005 they also paired up for the critically acclaimed film version of their hit.