The son of a high school football coach, Gilbertson grew up in Snohomish, Washington, northeast of Seattle. He graduated from Snohomish in 1966 and attended Central Washington University in Ellensburg, Columbia Basin College, the University of Hawaii, and returned to Central Washington, where he received a bachelor's degree in social sciences in 1971.
He later earned a degree in education from Western Washington University in 1974.
After three stints as a graduate assistant, Gilbertson became an offensive coordinator in 1977 at Utah State under head coach Bruce Snyder. After five seasons in Logan, he joined Dennis Erickson's new staff at Idaho, who immediately turned the Vandal program around in 1982, going 8–3 in the regular season and advancing to the quarterfinals of the I-AA playoffs. The following spring, Gilbertson departed for the Los Angeles Express of the newly formed USFL, where he coached as offensive coordinator for three seasons. Following the demise of the league, Gilbertson returned to Idaho in 1985, and the Vandals won their first Big Sky Conference title in 14 seasons. Erickson departed for Wyoming in December, and Gilbertson was promoted to head coach of the Vandals program. In his three seasons in Moscow as head coach (1986–88), Gilbertson's win-loss record was 28–9 (.757). Following consecutive conference championships and advancing to the Division I-AA national semifinals, he accepted an offer to coach the offensive line in the Pac-10 at Washington in Seattle under head coach Don James and offensive coordinator Gary Pinkel. Gilbertson replaced Dan Dorazio, the first assistant coach James had fired at Washington,] after they missed the bowl season for the first time in a decade. (After three wins to start the 1988 season, the Huskies finished 6–5 and 3–5 in conference, with losses to USC, UCLA, Oregon, Arizona, and WSU.) Gilbertson's three-year stint concluded with the undefeated 1991 national championship team, for which he was also offensive coordinator.
After Washington, Gilbertson became the head coach at California in 1992. Despite leading Cal to a 9–4 record with a decisive victory in the 1993 Alamo Bowl, he was dismissed after his fourth season when the 1995 Bears went 3–8. Gilbertson's overall record at Cal was 20–26.
After Cal, he was an assistant coach for the NFL's Seattle Seahawks for three seasons (1996–1998) under Erickson. He would serve as the TE coach for the 1997 and 1998 seasons. In 1999, he returned to the Washington Huskies as an assistant head coach under new head coach Rick Neuheisel.
Gilbertson became the head coach at Washington in 2003 following the abrupt summer dismissal of Neuheisel. He then returned to the Seahawks as an assistant under Mike Holmgren.
Keith is married to his wife Barbara, daughters Ann Gilbertson Haggart and Krissy Gilbertson and son David. He enjoys his two grandchildren Zoe and Julian Happart.