Mandel was born and lived in the Willowdale area of Toronto, Ontario. He is Jewish, and his ancestors emigrated from Romania and Poland. Mandel is also a distant cousin to violinist Itzhak Perlman. His father was a lighting manufacturer and a real estate agent. Mandel was expelled from his high school (William Lyon Mackenzie Collegiate Institute ) for impersonating a school official and hiring a construction company to build an addition to his school. Afterwards, Mandel worked as a carpet salesman. He was a stand-up comedian at Yuk Yuk's in Toronto and by September 1978 had a week-long booking as featured act, billed as "a wild and crazy borderline psychotic". His repertoire included placing a latex glove over his head and inflating it by blowing through his nose, the fingers of the glove extending above his head like a cockscomb. When the audience reacted uproariously to that and similar antics, his trademark response was to extend his arms palms up, look incredulous, and say, "it's you. " His manager during the Yuk Yuk years was Canadian David Holiff whom Mandel later fired.
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