Marshall was born in Wellington. He grew up in Wellington, Whangarei, and Dunedin, attending Whangarei High School and Otago Boys' High School. He was noted for his ability at sports, particularly rugby.
After leaving high school, Marshall studied law at Victoria University College (now Victoria University of Wellington). He gained a LLB in 1934 and a LLM in 1935. He also worked part-time in a law office.
In 1941, with the advent of World War II, Marshall entered the army, and received officer training. In his first few years of service, he was posted to Fiji, Norfolk Island, New Caledonia, and the Solomon Islands, eventually reaching the rank of Major. During this time he also spent five months in the United States at a marine staff school in Virginia. At the start of 1945, Marshall was assigned to a unit sent to reinforce New Zealand forces in the Middle East. This unit later participated in the battle of the Senio river and the liberation of Trieste.