Born in Aurora, Colorado on January 26, 1980, he was a 1999 graduate of Heritage High School. Dietz enlisted in the Navy on August 31, 1999. Following his graduating from Recruit Training Command, Naval Station Great Lakes, on November 27, 1999, he completed Gunner's Mate "A" School at the Naval Air Technical Training Center in Pensacola, Florida. From there he transferred to Basic Underwater Demolition/SEAL training and graduated with Class 232 in 2001. Dietz went on to attend the Basic Airborne Course at Fort Benning in Georgia, then SEAL Qualification Training and SEAL Delivery Vehicle Training. Immediately upon checking in at SEAL Delivery Vehicle Team 2 in Virginia Beach, Virginia, on November 8, 2001, he was assigned to Task Unit Bravo as the secondary SDV pilot and the Ordnance and Engineering Department head. In Virginia Beach, Dietz met and married his wife, Maria L. Dietz, in March 2003. In April 2005, Dietz deployed with his Special Reconnaissance element to Afghanistan to support Naval Special Warfare Squadron TEN in the prosecution of the Global War on Terrorism.
On June 28, 2005, A team of four Navy SEALs, tasked for surveillance and reconnaissance of a group of structures known to be used by Ahmad Shah and his men, fell into an ambush by Shah and his group just hours after inserting by fast rope from an MH-47 helicopter in the area. The SEAL team members were team leader Navy Lieutenant Michael P. Murphy of SEAL Delivery Vehicle Team 1 (SDVT-1), based out of Pearl Harbor, Hawaii; Petty Officer Second Class Danny P. Dietz from SEAL Delivery Vehicle Team 2 (SDVT-2), based out of Virginia Beach, Virginia; Petty Officer Second Class Matthew G. Axelson from SEAL Delivery Vehicle Team 1 (SDVT-1); and Navy Hospital Corpsman Second Class Marcus Luttrell, of SEAL Delivery Vehicle Team 1 (SDVT-1). Three of the four SEALs were killed in an ambush; a quick reaction force helicopter sent in for their aid was subsequently shot down with an RPG-7 rocket propelled grenade by one of Shah's men, killing all on board; 8 Navy SEALs and 8 U.S. Army Special Operations aviators. At the time, this was the worst single-day U.S. Forces death toll since Operation Enduring Freedom began and the single largest loss of life for Naval Special Warfare since World War II.
His hometown of Littleton, Colorado honored his memory by erecting a statue of Dietz in uniform holding his rifle, which was unveiled on July 4, 2007. His larger than life size bronze memorial was created by sculptor Robert Henderson of Canon City, Colorado. The South Wing of the Pacific Beacon Apartments at Naval Station San Diego is named Dietz Hall. A section of Santa Fe Drive (US Highway 85) between I-25 and C470 has been named the "Navy SEAL Danny Phillip Dietz, Jr. Memorial Highway."
On September 13, 2006, Gunner's Mate 2nd Class (SEAL) Danny Dietz Jr. was posthumously awarded the United States' 2nd highest citation for valor the Navy Cross