Russell was born in Park Ridge, Illinois and grew up in Chicago. He attended Maine South High School and was a graduate of the 1976 class. While attending the University of Illinois, Russell became fascinated with Chicago's active theater scene and began writing, acting and directing one act plays. Chicago's famous Second City Theater was an inspiration for Russell, where he saw such comedians as John Belushi and Dan Aykroyd get their start. Russell became fascinated with comedy improv, studying techniques he later applied in the development of such films as Back to School and The Mask.