Heinlein was motivated to write the story by an editorial in Thrilling Wonder Stories magazine, in which Hugo Gernsback wrote that he wanted to foster new talent in the field, and that "We shall endeavor to present one amateur writer's story in each forthcoming issue [...] until further notice." Thrilling Wonder Stories's rate at the time was 0.5¢ per word. After Heinlein had written the 7,000-word story, he submitted it first to a rival magazine, Astounding, which paid 1¢ per word. Astounding bought the story, and at their higher rate, Heinlein was paid $70. This was a significant sum in 1938 (approximately $1,100 in 2015 dollars).
According to Virginia Heinlein's introductory biography of her husband in Grumbles from the Grave, upon receiving the check for the story Heinlein reportedly said, "How long has this racket been going on?" Later, Heinlein's authorized biography included a version of the story in which Thrilling Wonder Stories had advertised a $50 contest. The first known version of this story appeared in a 1985 interview published in
Xignals, a science fiction newsletter.
"Life-Line" was later collected in The Worlds of Robert A. Heinlein (1966), Expanded Universe (1980), and in a Baen edition of "The Man Who Sold The Moon" (1987).