He was born into a successful business family

The son of Walter Cromwell, a yeoman, cloth merchant, fuller, and owner of both a hostelry and a brewery, Thomas Cromwell was born in Putney, Surrey, around 1485. He may not have been a blacksmith, but his use of the alternative surname "Smith" may have contributed to a long-standing custom that he also carried. Walter was elected Constable of Putney in 1495 and was frequently called to serve on juries due to his success as a tradesman. Walter was claimed to be of Irish descent by a knowledgeable but unnamed contemporaneous chronicler, but Norwell, Nottinghamshire, according to biographer James Gairdner, is where the Cromwell family originated. In Staffordshire, Thomas's mother, Katherine Peverell, came from a well-known "gentry family." When she wed Walter in 1474, she was residing in Putney at the home of a local lawyer named John Welbeck.

Cromwell had two sisters: Katherine married Morgan (ap William) Williams, a Welsh lawyer's son who came to Surrey as a supporter of King Henry VII when he established himself in the nearby Richmond Palace, and Elizabeth married William Wellyfed, a farmer. Katherine was Cromwell's older sister. Richard, the son of Katherine and Morgan, worked for his uncle as a servant and, by the fall of 1529, had adopted the name Cromwell.

The early years of Cromwell are poorly understood. He is thought to have been born at the peak of Putney Hill, close to Putney Heath.