Pederson was born and raised in Casa Grande, Arizona, the oldest of six brothers. Pederson's father, Ed Pederson, was the City Manager of Casa Grande for 25 years, and his mother, Lillian Pederson, was a registered nurse who stayed home to raise her sons. After high school in Casa Grande, Pederson went to the University of Arizona where he earned a bachelor's degree in political science and a master's in public administration.

After college, Pederson took a job with the Research and Budget Division for the city of Phoenix, and later worked as administrative assistant to Phoenix Mayor Milt Graham. When Graham left office, Pederson entered the commercial-development business working for Grossman Company Properties and Westcor and eventually formed The Pederson Group with his brother Gary. The Pederson Group has since developed over 25 retail projects across Arizona.

Pederson has been married to Roberta Pederson for 33 years. They have 3 children and 6 grandchildren.

In 2001, Pederson was elected chairman of the Arizona Democratic Party, which was then in need of funds and new infrastructure. Pederson was able to bring both. He is credited with recruiting two top-notch candidates for statewide office 2002: then-Arizona Attorney General Janet Napolitano for Governor and former Phoenix mayor and gubernatorial candidate Terry Goddard for Attorney General. Both won, and credit is often given to Pederson for his funding,^[1] his fundraising ability,^[2][3] and his leadership in rebuilding the Democratic party infrastructure.^[4]

Pederson's work, however, did not carry the state for Democratic candidate John Kerry in the 2004 U.S. presidential election, and none of the much-publicized campaigns by Democratic challengers in Arizona for the 2004 United States House of Representatives elections were successful in unseating Republican incumbents. Though the party didn't fare well in the 2004 federal elections, the Democratic Party increased its ranks in the Arizona State House of Representatives and lost only one Arizona State Senate seat, while George W. Bush carried Arizona by more percentage points in 2004 than he did in the 2000 election.

On September 14, 2005, Pederson formally announced his intention to run, in his home town of Casa Grande, Arizona. Pederson faced Jon Kyl, an incumbent who ran for a third term in the Senate. Early head-to-head polls showed Kyl significantly ahead of Pederson. In addition, a poll released on September 19, 2006, by SurveyUSA indicated that Kyl was still in the lead, although by a narrower margin: Kyl led Pederson by 48% to 43% with 7% undecided.

The race was one of the most expensive in Arizona history. As of May 7, Kyl's campaign had raised over $9 million primarily from private donations and large fundraising dinners. Pederson's campaign raised over $5 million primarily through a dinner event with former U.S. President Bill Clinton and a $2 million donation from Pederson himself.

In the general election on November 7, 2006, Pederson attained 44% of the popular vote (506,759 votes) compared to 53% of the vote for winner Jon Kyl.

• Arizona Democratic Party
• Official Jim Pederson Myspace.com page
• Appearances on C-SPAN