Hill was born in Toronto, the son of social scientist and public servant Daniel G. Hill and social activist Donna Mae Hill (nee Bender, 1928–2018), and older brother of the author Lawrence Hill and the late novelist Karen Hill. His musical talent was apparent from a young age, and he received his first guitar shortly after his tenth birthday. While in high school, he was singing and performing at concerts and coffee houses. At one point Hill was working for the Ontario provincial government sorting mail and delivering supplies, while performing at the Riverboat at night. Before finishing high school, he recorded a demo tape with the assistance of his boyhood friend Matt McAuley, later a well-known composer and arranger. In 1972, he signed a contract with RCA, who released a single the following year but did little to advance his career.