Thomas Denniston was born at Greenock, Renfrewshire, Scotland, on 28 March 1821, the son of John Denniston, a merchant, and his wife, Jean Fairrie. Thomas's parents died when he was young, and he was brought up by an uncle, Thomas Fairrie. Educated at Greenock and the University of Glasgow, Denniston did not take a degree but travelled extensively in Europe before going into business as a sugar merchant. On 15 October 1844 he married Helen French Walker at Glasgow. Five sons and two daughters were born before Helen Denniston died 10 days after the birth of the youngest son in 1855.
Denniston gave up business on account of ill health in 1862, and accompanied by his three elder sons emigrated to Dunedin, New Zealand, on the Nelson; the ship carried cargo largely supplied by Denniston. The Otago goldrush was then at its height, but Thomas Denniston was not tempted to join it. After a brief stay in Dunedin he moved to Southland where he bought about 500 acres of land at Oteramika, about 15 miles east of Invercargill. He also acquired in partnership with an Edinburgh professional man an interest in the Hillend run near Centre Bush. Circumstances suggest that Denniston may have been investing in land in order to restore flagging business fortunes.
He returned to Scotland at the end of 1864, but in 1867 was back in New Zealand with his two younger children. The interest in the Hillend run was sold and Denniston settled on his farm at Oteramika. Farming seems not to have completely satisfied him, however, and he turned to other pursuits. He was one of the founders of the Mataura paper mill in 1875, and sustained a considerable loss when the company failed. He also had a financial interest in the Southland Times. He was editor temporarily in the mid 1870s, and from October 1879 to May 1885. He then resigned, but continued to contribute to the paper. He upheld the rights of large runholders, and blamed Sir George Grey for creating class feeling in New Zealand. The employment of women horrified him: a working woman, he wrote, 'loses her divinity and becomes only an inferior man'.
Denniston took an active part in all public questions – political, ecclesiastical and social. He stood for the Mataura seat in the House of Representatives in 1871, but was heavily defeated, probably because of his opposition to Julius Vogel's borrowing policy. A prominent Presbyterian, he was deacon of First Church, Invercargill, until his death. He was a member of the Southland Land Board, the Southland Education Board, a school commissioner for the Otago Provincial District and a justice of the peace.
Denniston's health began to fail in 1896 and he died on 14 September 1897 at Fendalton, Christchurch, at the home of his eldest son, John Denniston, a judge of the Supreme Court.
Thomas Denniston 'was a man of warm temperament, of unscrupulous honour, generous…and courteous'. His abilities and inclinations were obviously more suited to literary than commercial pursuits, and his intellectual and cultural interests, and his dedication to community affairs, made him well respected in pioneering Invercargill.