When Lois was pregnant with Malcolm, Hal was trying to encourage Reese academically, by playing classical symphony music, which is popularly believed to spur intellectual development. Although the music did nothing for Reese, Lois was pregnant with Malcolm at the time, and listening to the music apparently contributed to his genius. Lois went into labor with Malcolm and gave birth to him out on their driveway.

Malcolm is the middle child of the family and is the show's protagonist. In the episode "Stock Car Races", Hal reveals that Malcolm is named after a race car driver called Rusty Malcolm (he mutters that it took 3 children to win that argument). At the beginning of the series, Malcolm's teacher recognizes him as a gifted student and places him in an accelerated learning class. Much to his dismay, the move brands him as a "krelboyne", a reference to Seymour Krelboyne from The Little Shop of Horrors.

Many episodes revolve around Malcolm's attempts to reconcile his genius-level 165 IQ with his desire to lead what he would consider a normal social life. However, Malcolm remains a social outcast in school. In middle school, Malcolm uncomfortably socializes with his fellow Krelboynes, but when the group moves on to high school, they no longer have classes together and stop interacting. Malcolm and Reese, particularly toward the end of the series, have no discernible group of friends. At this point, the only people Malcolm interacts with socially on a regular basis are his family, his genius best friend Stevie Kenarban, and a handful of short-term girlfriends.