Dancer was born in London in 1812. In 1835, John took over his father, Josiah’s, instrument-making business. He continued in business in Liverpool until 1841, when he entered into partnership with A. Abraham, a scientific instrument maker of Lord Street, Liverpool. He moved to Manchester to establish a branch of the business as Abraham & Dancer at 13 Cross Street. The partnership ceased in 1845. Dancer continued in business under his own name until 1878 when part of the business was transferred to his daughters Elizabeth Eleanor and Anna Maria.

Dancer became well known for the quality of his microscopes and particularly for selling good-quality instruments at a relatively low price. He received several honours which reflected the high quality of his microscopes, including a prize medal at the International Exhibition in London. He was appointed Optician in Manchester to the Prince of Wales.

Dancer also supplied apparatus, including a travelling microscope and thermometers, to James Prescott Joule in about 1844 for his work on the mechanical equivalent of heat. Joule described Dancer's thermometers as "the first which were made in England with any pretensions to accuracy". Dancer is perhaps best known for his photographic work, in particular on microphotography and the stereoscopic camera. He took the earliest known photograph of Manchester - showing the cutler's shop at 1 Market Street - in 1842.

In February 1852, Dancer produced his first microphotographs. These were tiny photographs on microscope slides, which were viewed through a microscope or viewer. They soon became very popular. Dancer produced photographs of many subjects including eminent scientists, religious texts and sights such as Niagara Falls. Dancer's friend, Sir David Brewster, exhibited some of the microphotographs in Florence and Rome and showed them to the Pope. At the London Exhibition of 1862, Dancer received an honourable mention for his invention.

In 1853, Dancer produced the first binocular stereoscopic camera. It allowed both pictures to be taken simultaneously at the correct distance apart. He improved it and,three years later, took out a patent for it.

In the early 1850s, Dancer made the photographic lantern slides using the collodion process, which may have been the first made in this way. There is some debate about this, but he is known to have provided more than 30 photographic slides for an exhibition at the Mechanics Institute in January 1854. The quality of his photographs led to about 20 painted slides being discarded before the end of the show. In 1857, Dancer introduced the ‘Fairy Fountain’, a water show with scores of minor jets in a variety of forms and colours. This was an improved version of a luminous chromatic fountain - a single column of water - and proved very popular.

Dancer died in November 1887.