Walter Nowotny joined the Luftwaffe on 1 October 1939 and following flight training at Jagdfliegerschule 5 was transferred to the I./Ergänzungs-Jagdgruppe Merseburg on 16 November 1940, flying fighter cover for the Leuna industrial works. From 25 March 1941 to 10 March 1942, he flew with the Stabsstaffel of the Ergänzungs-Jagdgruppe JG 54 where he was promoted to Leutnant on 1 April 1941.

Nowotny flew a Messerschmitt Bf 109 E-7 "White 2" on his 24th operational mission on 19 July 1941 and claimed his first two enemy aircraft, both Polikarpov I-153 biplanes over Saaremaa. He was shot down in the same engagement by Aleksandr Avdeyev, and spent three days in a dinghy in the Gulf of Riga until finally being washed ashore on the Latvian coast. For the rest of his combat career, Nowotny always wore the trousers that he had worn during those three days in the Gulf of Riga - with one exception, his last sortie, at Achmer on 8 November 1944, when he was killed flying the Messerschmitt Me 262 jet fighter.

After having downed three enemy aircraft on 11 August 1942, Leutnant Nowotny carried out three victory passes over the airfield, despite having sustained combat damage to his own Bf 109 "Black 1". In the subsequent landing, his aircraft somersaulted and he sustained moderate injuries. In January 1943, JG 54 started converting to the Focke-Wulf 190. With the new aircraft Nowotny scored at an unprecedented "kill" rate, often averaging more than two planes a day for weeks on end. Nowotny was promoted to Hauptmann on 21 September 1943. On 14 October 1943, he became the first pilot to reach 250 victories, following his 442 combat missions. Nowotny was celebrating this feat in the Ria Bar in Vilna when he received a phone call from Hitler himself, announcing that he had been awarded the Knight's Cross of the Iron Cross with Oak Leaves, Swords and Diamonds. He claimed his final two aerial victories on the Eastern Front on 15 November 1943. In total, he had claimed 255 confirmed kills plus a further 50 unconfirmed, before he was taken off combat duty.

In September 1944, Nowotny was made commander of a specialist unit dubbed Kommando Nowotny, flying the newly developed Me 262 out of airfields near Osnabrück. On 8 November 1944, news reached the command post of a large bomber formation approaching. Two Rotten of Me 262 were prepared for take-off, Erich Büttner and Franz Schall at Hesepe, and Nowotny and Günther Wegmann at Achmer. At first only Schall and Wegmann managed to take off because Büttner had a punctured tire during taxiing and Nowotny's turbines initially refused to start. With some delay, Nowotny took off and engaged the enemy on his own, Schall and Wegmann having since retired from the action after sustaining battle damage. Nowotny radioed that he had downed a B-24 Liberator and a P-51 Mustang before he reported one engine failing and made one final transmission, his last words were, "I'm on fire" or "it's on fire". The words were slightly garbled.

Walter Nowotny flew over 442 missions in achieving 258 victories.