After graduating from Hampton Institute with honors, Washington spent several years teaching in Malden and later at his alma mater. In 1881 the Alabama legislature authorized the establishment of a normal school to train black teachers at Tuskegee, in Macon county, the heart of the Blackbelt. On the recommendation of Armstrong, Washington assumed the position of principal at the Tuskegee Institute. The mission of Tuskegee, similar to Hampton's, was to teach African Americans how to become economically self-supporting through the acquisition of vocational and industrial skills. Tuskegee stressed the dignity of labor and prepared its students to become farmers, artisans, and teachers, and it de-emphasized dissatisfaction with the sociopolitical order. Washington's reputation as the principal of Tuskegee grew through the late 1880s and early 1890s, owing to his ability to attract the support of Northern philanthropists and placate Southern conservatives.

Washington's fame and recognition as a race leader reached a high point with a single speech delivered at the 1895 Cotton States and International Exposition in Atlanta before a racially mixed audience. This speech, often called the Atlanta Compromise, is the best single statement of Washington's philosophy of race advancement. In his speech Washington urged African Americans to “cast down your bucket where you are” and make the most of what the South had to offer through self-help and economic initiative. He also explicitly argued against agitation for political and civil rights. His philosophy of accommodation was most evident in the famous remark that “in all things that are purely social we can be as separate as the fingers, yet one as the hand in all things essential to mutual progress.”

Washington continued to gain prominence with his writings, especially his best-selling autobiography, Up from Slavery, published in 1901. His political influence expanded significantly during the Roosevelt and Taft administrations since no philanthropic board, political machine, or federal office would appoint or support any African American without Washington's tacit approval. President Roosevelt's decision to invite the black educator to lunch at the White House created a sensation, especially in Southern newspapers. Washington also founded the National Negro Business League in 1900, which emphasized racial solidarity and supported the black entrepreneurial class. Most black intellectuals condemned his accommodationist stance and lack of interest in agitating openly for social equality or the right to vote. W. E. B. Du Bois, Washington's most vocal opponent, argued that the system of industrial education perpetuated a racial caste system in which blacks stood to be nothing more than manual laborers, and he criticized what he called the “Tuskegee Machine” because of its exclusive access to Northern philanthropy and political patronage as well as its overwhelming power to silence its critics.

Washington countered such criticism both publicly and behind the scenes. He secretly financed test cases to challenge segregation and the debt peonage system in the South. He also waged a campaign against the all-white Republican movements in the South. A controversial figure, particularly in the later years of his life, Washington remained one of the most prominent African American leaders until his death in Tuskegee, Alabama, on November 14, 1915, from overwork and exhaustion.