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Was wary about appearing in Casablanca (1942) for fear that it would ruin his image and cause him to fade from the public eye. Ironically, it's the very film which immortalized him.

He was "investigated" by the House Un-American Activities Committee during the McCarthy "Red Scare" period in the 1950s and was subsequently blacklisted in Hollywood.

In 1943, he and his wife Lisl purchased the luxurious "Fonda House", designed by architect Paul Williams, from Henry Fonda and his wife Frances for $42,000. In 1970, tired of the expense and work to maintain such a large property, they sold that house and bought a smaller one in Pacific Palisades. Norman Lear was a later owner of the Fonda/Henreid house.

When he was a boy, Henried was cautioned by an uncle that "acting and syphilis are on the same rung of the social ladder.".

He was the son of Marie Luise Heilig von Heiligen (Lendecke) and Baron Karl Alphons Hernreid, a banker, who was a financial advisor to Emperor Franz Josef. Paul's father was from a Jewish family from Slovakia and Prague, and was the son of Laura Karoline (Schefteles) and Emil Hirsch.