Stephen Colbert joined the cast of Comedy Central's parody-news series The Daily Show in 1997, when the show was in its second season. Originally one of four correspondents who filmed segments from remote locations in the style of network news field reporters, Colbert was referred to as "the new guy" on-air for his first two years on the show, during which time Craig Kilborn served as host. When Kilborn left the show prior to the 1999 season, Jon Stewart took over hosting duties, also serving as a writer and co-executive producer. From this point, the series gradually began to take on a more political tone and increase in popularity, particularly in the latter part of the 2000 U.S. presidential election season. The roles of the show's correspondents were expanded to include more in-studio segments, as well as international reports which were almost always done in the studio with the aid of a greenscreen.^[18]

Unlike Stewart, who essentially hosts The Daily Show as himself,^[32] Colbert developed a correspondent character for his pieces on the series. Colbert has described his correspondent character as "a fool who has spent a lot of his life playing not the fool"—one who is able to cover it at least well enough to deal with the subjects that he deals with".^[18] Colbert was frequently pitted against knowledgeable interview subjects, or against Stewart in scripted exchanges, with the resultant dialogue demonstrating the character's lack of knowledge of whatever subject he is discussing.^[6][18] Colbert also made generous use of humorous fallacies of logic in explaining his point of view on any topic. Other Daily Show correspondents have adopted a similar style; former correspondent Rob Corddry recalls that when he and Ed Helms first joined the show's cast in 2002, they "just imitated Stephen Colbert for a year or two."^[7] Correspondent Aasif Mandvi has stated "I just decided I was going to do my best Stephen Colbert impression."^[8]

Colbert has appeared in several recurring segments for The Daily Show, including "Even Stevphen" with Steve Carell, in which both characters were expected to debate a selected topic but instead would unleash their anger at one another. Colbert also commonly hosted "This Week in God," a report on topics in the news pertaining to religion, presented with the help of the "God Machine." Colbert also filed reports from the floor of the Democratic National Convention and the Republican National Convention as a part of The Daily Show's award-winning coverage of the 2000 and 2004 U.S. Presidential elections; many from the latter were included as part of their The Daily Show: Indecision 2004 DVD release. In several episodes of The Daily Show, Colbert filled in as anchor in the absence of Jon Stewart, including the full week of March 3, 2002, when Stewart was scheduled to host Saturday Night Live. After Colbert left the show, the duty of filling in for Stewart was assumed by Rob Corddry until his departure in August 2006. Corddry also took over "This Week in God" segments, although a recorded sample of Colbert's voice is still used as the sound effect for the God Machine. Later episodes of The Daily Show have reused older Colbert segments under the label "Klassic Kolbert." Colbert won three Emmys as a writer of The Daily Show in 2004, 2005, and 2006.

Since October 17, 2005, Colbert has hosted his own television show, The Colbert Report, a Daily Show spin-off which parodies the conventions of television news broadcasting,^[14] particularly cable-personality political talk shows like The O'Reilly Factor and Scarborough Country.^[3][33] Colbert hosts the show in-character as a blustery right-wing pundit, generally considered to be an extension of his character on The Daily Show. Conceived by co-creators Stewart, Colbert, and Ben Karlin in part as an opportunity to explore "the character-driven news," the series focuses less on the day-to-day news style of the Daily Show, instead frequently concentrating on the foibles of the host-character himself.

The concept for The Report was first seen in a series of Daily Show segments which advertised the then-fictional series as a joke. It was later developed by Stewart's Busboy Productions and pitched to Comedy Central, which greenlighted the program; Comedy Central had already been searching for a way to extend the successful Daily Show franchise beyond a half hour.^[34] The series opened to strong ratings, averaging 1.2 million viewers nightly during its first week on the air. Comedy Central signed a long-term contract for The Colbert Report within its first month on the air, when it immediately established itself among the network's highest-rated shows.^[35][36]

Much of Colbert's personal life is reflected in his character on The Colbert Report. With the extended exposure of the character on the show, he often references his interest in and knowledge of Catholicism, science fiction, and The Lord of the Rings, as well as using real facts to create his character's history. His alternate persona was also raised in South Carolina, is the youngest of 11 siblings, and is married.^[37] The actual Colbert's career history in acting and comedy, however, is often downplayed.

Colbert in support of the United States Military and in association with the USO brought his show to Baghdad, Iraq on June 5, 2009 to film a week of shows, entertain the troops, and boost morale for forces in Iraq. Called Operation Iraqi Stephen, The episodes were filmed from the 7th-9th of June, 2009.