Shelby was born in Lexington, Kentucky, to one of the state's wealthiest and most influential families. He lost his father at age 5, and was raised by a stepfather. Shelby attended Transylvania University and was a rope manufacturer until 1852. He then moved to Waverly, Missouri, where he engaged in steamboating on the Missouri River and in running a hemp plantation. He was one of the largest slaveholders in the state. During the "Bleeding Kansas" struggle, he led a company on the pro-slavery side.
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