Daniel Allen was born on February 3, 1922, in Canton, Indiana. He enlisted in the U.S. Navy on July 16, 1940, and after completing basic training at USNTS Great Lakes, Illinois, he attended the Submarine School at New London, Connecticut from December 1940 to January 1941, and then Sound Operator School from February to March 1942. His first assignment was as a Signalman aboard the submarine USS O-8 (SS-69) from April 1941 to May 1942, when he joined the crew of the submarine USS Grunion (SS-216). SM3C Allen was killed in action during a confrontation with the armed Japanese freighter Kano Maru on July 30, 1942. On August 22, 2007, a search team organized by the three sons of CDR Mannert Abele (the Captain of the Grunion when she was sunk) used a remotely operated vehicle to find a sunken vessel 3,000 feet down in the Bering Sea north of Kiska Island at the tip of the Aleutian Islands. On October 1, 2008, the U.S. Navy announced that the sunken vessel is the World War II submarine USS Grunion (SS-216).

His Navy Commendation Medal Citation reads:

For meritorious conduct as a member of the crew of the U.S.S. GRUNION which destroyed three enemy destroyers while engaged in a war patrol in enemy controlled waters. Despite severe and persistent anti-submarine measures resulting from these three successful attacks, the GRUNION was brought safely through the counter attacks and continued an aggressive war patrol. As a member of the crew of the GRUNION, your performance of duty was an important and material contribution to the prosecution of this war.