Walter received early training in a variety of fields including masonry, mathematics, physical science, and the fine arts before studying architecture in the office of William Strickland. He began practicing architecture in 1830 and was one of the founders and second president of the American Institute of Architects.

By 1850 the rapid expansion of the United States caused a space shortage in the Capitol. Walter, a prominent Philadelphia architect, was selected to design extensions for the Capitol. His plan more than doubled the size of the existing building and added the familiar cast-iron dome. Construction on the wings began in 1851 and proceeded rapidly; the House met in its new quarters in December of 1857 and the Senate occupied its new chamber by January of 1859. Walter's fireproof cast-iron dome was authorized by Congress on March 3, 1855, and was nearly completed by December 2, 1863, when the Statue of Freedom was placed on top. He also reconstructed the interior of the west center building for the Library of Congress after the fire of 1851. Walter continued as Capitol architect until 1865, when he resigned his position over a minor contract dispute. After 14 years in Washington, he retired to his native Philadelphia.