Olausson was born in Älvdalen, Sweden, the son of Oscar Olausson and his wife Ebba (née Käns). He passed "studentexamen" in Västervik in 1947 and then began his 27-year career in the Swedish Air Force as an officer cadet, flying the Bücker Bestmann, Harvard, Vampire, and P-51 Mustang, in that order. He was a flight engineer at the Swedish Air Force Flying School in 1953 and decided the same year that he was not suited to be an officer, and got himself into the Royal Institute of Technology in Stockholm. In 1954 he was a flight engineer at Uppland Air Force Wing (F 16) (Flygvapnets Uppsalaskolor). After 4½ years, he reentered the Swedish Air Force as an engineer officer, flying the Saab J 29A fighter, A 32A Lansen attack, and AJ 37 Viggen (also attack but primarily doing check flying after maintenance).