Steiger made his stage debut in a production of Curse you, Jack Dalton! (1946) at the Civic Repertory Theatre of Newark. Subsequent to this, he received an invitation from one of his teachers, Daniel Mann, to attend the Actors Studio, established by Elia Kazan in October 1947. It was here, along with Marlon Brando, Karl Malden, and Eli Wallach, that he studied method acting, which became deeply engrained in him. Lacking matinée idol looks, much like Malden and Wallach, he began pursuing a career as a character actor rather than as a leading man. Steiger's stage work continued in 1950, with a minor role as a townperson in a stage production of An Enemy of the People at the Music Box Theatre. His first major role on Broadway came in Clifford Odets's production of Night Music (1951), where he played A. L. Rosenberger. The play was held at the ANTA Playhouse. The following year, he played a telegraphist in the play Seagulls Over Sorrento, performed at the John Golden Theatre beginning on September 11, 1952.
Steiger's early roles, although minor, were numerous, especially in television series during the early 1950s, when he appeared in more than 250 live television productions over a five-year period. He was spotted by Fred Coe, NBC's manager of program development, who increasingly gave him bigger parts. Steiger considered television to be what repertory theatre had been for an earlier generation, and saw it as a place where he could test his talent with a plethora of different roles. Soon afterward he began receiving positive reviews from critics such as John Crosby, who noted that Steiger regularly gave "effortless persuasive performances". Among Steiger's credits were Danger (1950–53), Lux Video Theatre (1951), Out There (1951), Tales of Tomorrow (1952–53), The Gulf Playhouse (1953), Medallion Theatre (1953), Goodyear Television Playhouse (1953), and as Shakespeare's Romeo in "The First Command Performance of Romeo and Juliet (1957)" episode of You Are There in 1954, under director Sidney Lumet. He continued to make appearances in various playhouse television productions, appearing in five episodes of Kraft Theatre (1952–54), which earned him praise from critics, six episodes of The Philco Television Playhouse (1951–55) and two episodes of Schlitz Playhouse of Stars (1957–58). Steiger made his big screen debut in 1953, with a small role in Fred Zinnemann's Teresa, shot in 1951. Steiger, who described himself as "cocky", won over Zinnemann by praising his direction. Zinnemann recalled that Steiger was "very popular, extremely articulate and full of remarkable memories", and the two remained highly respectful of each other for life.
On May 24, 1953, Steiger played the title role in Paddy Chayefsky's "Marty" episode of the Goodyear Television Playhouse. The role had originally been intended for Martin Ritt, who later became a director. "Marty" is the story of a lonely and homely butcher from the Bronx in search of love. The play was a critical success that increased Steiger's public exposure; Tom Stempel noted that he brought "striking intensity to his performance as Marty, particularly in giving us Marty's pain". As Steiger refused to sign a seven-year studio contract, he was replaced with Ernest Borgnine in the film Marty (1955), which won the Academy Award for Best Picture, as well as the Best Actor Oscar for Borgnine. 1953 proved to be Steiger's breakthrough year; he garnered Sylvania Awards for Marty and four other best performances of the year—as Vishinsky and Rudolf Hess in two episodes of You Are There, as gangster Dutch Schultz in a thriller, and as a radar operator in My Brother's Keeper.
For his role as Charley "the Gent", the brother of Marlon Brando's character in Elia Kazan's On the Waterfront (1954), Steiger was nominated for the Academy Award for Best Supporting Actor. Film writer Leo Braudy wrote that the "incessantly repeated images of its taxicab confrontation between Brando and Rod Steiger have made the film iconic". The taxicab scene took eleven hours to shoot and was heavily scripted, despite Brando fuelling the popular myth in his autobiography that the scene was improvised. Brando stated that seven takes were needed because Steiger could not stop crying, which Steiger found to be unfair and inaccurate. Although Steiger retained great respect for Brando as an actor, he disliked him as a person and frequently complained during the production of Brando's "predilection for leaving the set" immediately after shooting his scenes. Steiger later remarked: "We didn't get to know each other at all. He always flew solo and I haven't seen him since the film. I do resent him saying he's just a hooker, and that actors are whores". Steiger also responded unfavorably when he learned that Kazan had been awarded an honorary Oscar by the Academy in 1999. In a 1999 interview with BBC News, Steiger said he probably would not have done On the Waterfront if he'd known at the time that Kazan had provided the House Un-American Activities Committee with names of performers suspected of being Communists.
Steiger played Jud Fry in the film version of the Rodgers and Hammerstein musical Oklahoma! (1955), in which he performed his own singing. It was one of the biggest location film productions of the 1950s, shot near Nogales, Arizona with a crew of 325 people and some 70 trucks. Steiger portrayed a disturbed, emotionally isolated version of Jud, which television channel Turner Classic Movies (TCM) believed brought a "complexity to the character that went far beyond the stock musical villain". Steiger observed that James Dean, who auditioned for the role that went to Gordon MacRae, was a "nice kid absorbed by his own ego, so much so that it was destroying him", which he thought led to his death. Dean reportedly gave Steiger his prized copy of Ernest Hemingway's book Death in the Afternoon, and had underlined every appearance of the word "death".
Later in 1955, Steiger played an obnoxious film tycoon, loosely based on Columbia boss Harry Cohn, opposite Jack Palance and Ida Lupino in Robert Aldrich's film noir The Big Knife. Steiger bleached his hair for the part, sought inspiration for the role from Russian actor Vladimir Sokoloff, read a book about the Treblinka extermination camp to understand his character thoroughly, and visited the perfume department of a store in Beverly Hills, California, to try to understand his character's contempt for women. Steiger and Palance did not get along during the production, and in one scene Palance threw several record albums at Steiger in frustration, feeling that he was trying to steal the scene. Steiger earned critical acclaim later that year for a role as a prosecuting major in Otto Preminger's The Court-Martial of Billy Mitchell, alongside Gary Cooper and Charles Bickford.
Steiger portrayed the character "Pinky" in Columbia Pictures' western, Jubal (1956), which co-starred Glenn Ford and Ernest Borgnine. Steiger's character is a rancher, a "sneering baddie", who becomes jealous when his former mistress becomes attracted to Ford's character. Ford noted Steiger's deep commitment to method acting during production, considering him to be a "fine actor but a real strange fellow". Steiger disliked the experience and frequently clashed with director Delmer Daves, who was more favorable to Ford's lighthearted take on the film. Upon its release in April 1956, a writer for Variety was impressed with the "evil venom" displayed by his character, and remarked that there had not "been as hateful a screen heavy around in a long time".
In Mark Robson's The Harder They Fall, Steiger played a crooked boxing promoter who hires a sports journalist (Humphrey Bogart in his last role). Steiger referred to Bogart as "a professional" who had "tremendous authority" during filming.