A Montrose native, Steve Peters graduated from Montrose High School in 1964. During his tenure at Montrose, he played basketball and baseball, excelling in both sports. As a junior, he led the Meteors to the Susquehanna League and District 12 basketball championship. It was, however, in 1963-64 that his talent as a basketball player attracted the attention of sports writers and college recruiters. He led the Meteors to a 26 and 0 record, defeating Mercer (the Western PIAA representative) for the State Championship. He was honored by being placed on the Class B All State Team. Steve was recruited by Tates Locke, head coach at Army, and his assistant, who at that time was none other than the great Bob Knight; Bob Cousy of Boston College and numerous other college coaches. Steve was sent to the Berkshire School in Connecticut to prep for the Point. His team lost only two games and was invited to Madison Square Garden for the Annual Prep School Tournament. His coach remarked that he was the best player he ever saw for a boy his age. He entered the Military Academy and a bout with infectious mononucleosis caused him to withdraw. He later transferred to Penn State but had to sit out a year before he could regain his eligibility. As a sophomore, he became the sixth man and started games against West Virginia, Syracuse, and Rutgers. Following his sophomore year at Penn State, he was committed to enter the Army Reserves, and later entered East Stroudsburg University. His parents relocated to Hawaii and Steve then recommitted himself to reserve duty in that state. He was injured in a surfing accident in Hawaii, thus ending a promising athletic career. Si Bernosky who coached Steve at Montrose High School, regards him as the best all-around basketball player he has ever coached.