Johnston was born in Uruguay in 1872 of Scottish parents; he entered Edinburgh University as a medical student in 1896 but abandoned his studies a year later. In September 1899 he was invited by William Lethaby, the principal of the Central School of Arts and Crafts, to start a class on writing and illuminating. This was largely responsible for the revival of the subject in Britain; his students included Eric Gill*, Noel Rooke and W. Graily Hewitt*. Johnston taught at the Royal College of Art from 1901 and, from1902, leased chambers in Lincoln's Inn as his design studio. He married in 1903.
He designed initial letters and headings for the Doves Press, Hammersmith (from 1902) and type for the Cranach Press, Weimar (from1910). In 1915 he was commissioned by Frank Pick of London Underground to design an alphabet for use on station signs and as a typeface for printed matter. Named 'Railway', this sans-serif design is still in use today, in a revised, digitised form; so, too, is Johnston's circular London Underground logo.
In 1906 his handbook Writing and Illuminating, and Lettering was first published; it ran into several editions and was translated into German in 1910. In 1912 Johnston moved to Ditchling, Sussex where Eric Gill already lived and an artistic community was forming. He continued to teach, write and publish, was president of the Art and Crafts Exhibition Society from 1933 to 1936 and appointed CBE in 1939. A retrospective exhibition took place at the Victoria and Albert Museum in 1945.
*Denotes included in the Crafts Study Centre Collection