In 1878 the Blumenschein family moved to Dayton, Ohio where the elder Blumenschein was appointed director of the Dayton Philharmonic Orchestra. Ernest's professional schooling at the Cincinnati College of Music where he studied violin. More interested in art than music, he turned to classes in illustration at the Art Academy of Cincinnati under Fernand Lungren.
In 1892 Blumenschein went to New York where he studied at the Art Students League, supplementing his income by playing first violin under Anton Dvorak. Blumenschein made his first trip to Paris in 1894, where he met Bert Phillips, Eanger I. Couse and Joseph Sharp, with whom he would later be associated in Taos, New Mexico.
Returning to New York in 1896 he shared a studio with Bert Phillips, and worked on illustration commissions from McClure's, Scribner's, Century, Harper's, and America magazines. On an assignment for McClure's in 1898, Blumenschein and Phillips traveled to the Southwest and first discovered Taos. On this initial visit Blumenschein only stayed for a few months, however Phillips remained.
Blumenschein returned to Paris in 1899, again staying two years, before returning to New York for a year. In 1902 he left again for Paris, this time remaining until 1909. He and Mary Greene married in 1905.
Upon the couple's return to New York they took a studio in the Sherwood Building, collaborated on illustration work, and taught at Pratt Institute. Blumenschein taught painting and illustration at the Art Students League from 19l2 to 19l5. He was also providing illustrations for books by Jack London, Willa Cather, Booth Tarkington, Joseph Conrad, Stephen Crane and Hamlin Garland.
Blumenschein made annual sketching trips to Taos, until 1919, after an exhibition of his Southwestern pictures at the Fakir Club in New York, and with the reassurance of an inheritance, the Blumenscheins moved permanently to Taos. Once in Taos, Blumenschein gave up illustration work and concentrated solely on his painting. His subject matter revolved completely around Indian life and customs. His compositions were panoramic and often included large numbers of figures. Their stage-like settings were academically derived which gave a monumentality and drama to his works. Often he would focus on the religious, ritualistic and superstitious elements of Indian culture which he would emphasize through a surrealistic or symbolic style.
Blumenschein also executed murals including three panels for the Missouri State Capitol, 1926, and The Spanish Peaks for the post office at Walsenburg, Colorado, 1937.
Blumenschein's work was early included in major competetive exhibitions, and he received many awards, among them the Philadelphia Watercolor Society's Beck Prize in 19l0, and the Art Institute of Chicago Potter Palmer gold medal in 19l7. The Academy awarded him an Isidor medal in the winter exhibition of 19l2, and Altman prizes in 1921 and 1925.