Twenty-five years later, it is one of the biggest selling novels of all time after capturing the hearts and imaginations of children around the world.
"I gave it to Alice who took it upstairs... We had the chapters up to Diagon Alley at that stage," Newton told Reuters.
"She kind of floated down the stairs an hour later saying: 'Dad, this book is better than anything you've shown me'."
Sunday marks 25 years since Rowling's first book about the magical world of witches and wizards was published.
Rowling had faced rejection until Bloomsbury took her work on with an advance of 2,500 pounds. Her story went on to become a massive hit around the world, spawning a whole series of books and a huge film franchise.
"Did we know that it would sell over 500 million copies by the summer of 2022? No, but we did know that it was a great piece of writing," Newton said.
"It was children and not their parents who were the original adopters of this book. It was a complete grassroots phenomenon."
Those children would queue for hours in front of bookstores awaiting the latest instalments of Harry's adventures, which culminated with 2007's "Harry Potter and the Deathly Hallows".
For some, like Jacqueline Hulbert, now 23, it also helped them to enjoy reading.
"It was just phenomenal. It was nothing like I had tried to read before because the story was gripping enough that I wanted to keep trying to read it," Hulbert said.
"Because unbeknownst to muggles (those lacking magical powers in the books) and like everyone we know there was like this hidden world in plain view, almost.”
The image of Harry in front of the Hogwarts Express, the train taking him to the famed magical school, is one of the most recognisable book covers in children's literature.
It was done by author and illustrator Thomas Taylor in his first work commission. Taylor, then 23 and working in a children's bookshop, had dropped off a sample portfolio depicting dragons at Bloomsbury.
"A few days later... the phone rang and it was (publisher) Barry Cunningham from Bloomsbury asking me whether I'd like to do the cover art for a new book by a new author no one had heard of," Taylor, known for the Eerie-on-Sea children's books, said.
"And so I was pretty excited so I said yes. And of course I had no idea what it would go on to become."