Eggers was born in Boston, Massachusetts, one of four siblings. His father, John K. Eggers (1936–1991), was an attorney, while his mother, Heidi McSweeney Eggers (1940–1992), was a school teacher. His father was Protestant and his mother was Catholic. When Eggers was still a child, the family moved to the suburb of Lake Forest, near Chicago, where he attended high school and was a classmate of actor Vince Vaughn. Eggers attended the University of Illinois at Urbana–Champaign, intending to get a degree in journalism. However, his studies were interrupted by the deaths of both of his parents: his father in 1991 from brain and lung cancer, and his mother in January 1992 from stomach cancer.

However, as Eggers later recounted in his memoir, A Heartbreaking Work of Staggering Genius, the magazine consistently struggled to make a profit, and finally ceased publication in 1997. An anthology of the best of Might magazine’s brief run, ‘Shiny Adidas Tracksuits and the Death of Camp’ and Other Essays from Might Magazine, was published in late 1998. By this time, Eggers was freelancing for Esquire magazine and continuing to work for Salon.

Eggers founded McSweeney’s, an independent publishing house, named for his mother’s maiden name. The publishing house produces a quarterly literary journal, Timothy McSweeney’s Quarterly Concern, first published in 1998; a monthly journal, The Believer, which debuted in 2003 and is edited by Eggers’s wife, Vendela Vida; and, from 2005 to 2012, a quarterly DVD magazine, Wholphin. Other works include The Future Dictionary of America, Created in Darkness by Troubled Americans, and “Dr. and Mr. Haggis-On-Whey”, all children’s books of literary nonsense, which Eggers writes with his younger brother and uses as a pseudonym.

Eggers’s elder brother, Bill, is a researcher who has worked for several conservative think tanks, doing research promoting privatization. Eggers’s sister, Beth, died of suicide in November 2001. Eggers briefly spoke about his sister’s death during a 2002 fan interview for McSweeney’s.

In 2002, Eggers published his first fully fictional novel, You Shall Know Our Velocity, a story about a frustrating attempt to give away money to deserving people while haphazardly traveling the globe. An expanded and revised version was released as Sacrament in 2003. A version without the new material in Sacrament was created and retitled You Shall Know Our Velocity! for a Vintage imprint distribution. He has since published a collection of short stories, How We Are Hungry, and three politically themed serials for Salon.com.

In 2002, Eggers and educator Nínive Clements Calegari co-founded 826 Valencia, a nonprofit writing and tutoring center for kids ages 6–18 in San Francisco. It has since grown into six chapters across the United States: Los Angeles, New York City, Chicago, Ann Arbor, Michigan, Washington, D.C., and Boston, all under the auspices of the nonprofit organization 826 National.

In 2005, he was awarded an honorary Doctor of Letters from Brown University. He delivered the baccalaureate address at the school in 2008.

In November 2005, Eggers published Surviving Justice: America’s Wrongfully Convicted and Exonerated, a book of interviews with former prisoners sentenced to death and later exonerated. The book was compiled with Lola Vollen, a specialist in the aftermath of major human rights abuses and a visiting scholar at the University of California, Berkeley’s Institute of International Studies.

Eggers’s 2006 novel What Is the What: The Autobiography of Valentino Achak Deng was a finalist for the 2006 National Book Critics Circle Award for Fiction. Eggers also edits the Best American Nonrequired Reading series, an annual anthology of short stories, essays, journalism, satire, and alternative comics.

In 2006, he appeared at a series of fund-raising events, dubbed the Revenge of the Book–Eaters tour, to support these programs. The Chicago show, at the Park West theatre, featured Death Cab for Cutie front man Ben Gibbard. Other performers on the tour included Sufjan Stevens, Jon Stewart, Davy Rothbart, and David Byrne. In September 2007, the Heinz Family Foundation awarded Eggers a $250,000 Heinz Award (given to recognize “extraordinary achievements by individuals”) in the Arts and Humanities. In accordance with Eggers’s wishes, the award money was given to 826 National and The Teacher Salary Project.

On November 7, 2009, he was presented with the “Courage in Media” Award by the Council on American-Islamic Relations for his book Zeitoun. Zeitoun was optioned by Jonathan Demme, who considered an animated film-rendition of the work. To Demme, it “felt like the first in-depth immersion I’d ever had through literature or film into the Muslim-American family. … The moral was that they are like people of any other faith, and I hope our film, if we can get it made, will also be like that.” Demme, quoted in early 2011, expressed confidence that when the script was finished, he would be able to find financing, perhaps even from a major studio. However, in May 2014, The Playlist reported that the film was “percolat[ing] in development”. Demme died in April 2017, and the project has not been heard of since.

While at the University of Illinois, Urbana-Champaign, Eggers attended art classes. After the publication of A Heartbreaking Work of Staggering Genius, he focused mainly on writing, but publicly returned to visual art with a solo gallery show at Electric Works, San Francisco, in 2010, called “It Is Right to Draw Their Fur.” The show featured many drawings of animals often paired with phrases, sometimes out of the Bible. In conjunction with that exhibition, McSweeney’s published a catalog featuring 25 loose-leaf prints of the work featured in the show. In 2015 Eggers had his first solo museum exhibition at the Nevada Museum of Art called “The Insufferable Throne of God”. Eggers is represented by Electric Works a fine art gallery in San Francisco.

In April 2010, under the umbrella of 826 National, Eggers launched ScholarMatch, a nonprofit organization that connects donors with students to make college more affordable.

In the early 2010s, after going six years without publishing substantive literary fiction following What is the What, Eggers began a three-year streak of back-to-back novels, each broadly concerned with pressing social and political issues facing the United States and the wider world in the twenty-first century. Eggers published his novel of the Great Recession and late 2000s financial crisis, A Hologram for the King, in July 2012. In October of that year, the novel was announced as a finalist for the National Book Award.

Eggers followed this with The Circle, released in October 2013, and depicting the life of a young worker at a fictional San Francisco-based technology company in the near future, as she faces doubts about her vocation, due to the company’s seemingly well-intentioned innovations revealing a more sinister underlying agenda. Completing the productive spell, a new novel concerning anxiety with America’s place in the world, Your Fathers, Where Are They? And the Prophets, Do They Live Forever?, was published in June 2014. In November 2015, Your Fathers, Where Are They… was longlisted for the 2016 International Dublin Literary Award, Eggers’ fifth nomination for the award following earlier nominations for The Circle, A Hologram for the King, The Wild Things, and What is the What.

In July 2016, Eggers published his sixth novel Heroes of the Frontier. Earlier the same year, a film adaptation of Eggers’ earlier novel A Hologram for the King was released, to mixed reviews and middling commercial performance. The Circle, a film version of Eggers’ book, starring Emma Watson, John Boyega, and Tom Hanks (who had starred in the Hologram for the King adaptation), was released in April 2017. Eggers followed Heroes of the Frontier with The Monk of Mokha (2018), another nonfiction biography in a similar vein to Zeitoun, billed by the publishers as “the exhilarating true story of a young Yemeni American man, raised in San Francisco, who dreams of resurrecting the ancient art of Yemeni coffee but finds himself trapped in Sana’a by civil war.”

Eggers ended the decade by publishing two very stylistically different novellas, written concurrently with each other. The Parade, published by Knopf in March 2019, was a spare, minimalist novella reflecting Eggers’ long-standing concerns with humanitarian issues, global development, and Western perceptions of the developing world. According to the advance blurb from the publisher, the novel concerns “two men, Western contractors sent to work far from home, tasked with paving a road to the capital in a dangerous and largely lawless country.” Reviews were mixed: positive notices included Andrew Motion writing in The Guardian that “[Eggers’] novel may be sternly reduced in terms of its cast and language, but this leanness doesn’t diminish the strength of its argument,” while Ron Charles in the Washington Post demurred that The Parade “[is] a story that conforms to the West’s reductive attitudes about the developing world. Writers and politicians have long generalized about those individual cultures. A novel that lumps them together into a nameless, primitive nation only plays into that tendency.” The Parade was followed in November 2019 by another short novella, The Captain and the Glory, billed by Eggers himself as a “allegorical satire” of the Trump administration. In an interview with the publishers Knopf published on the McSweeney’s website, Eggers described the novel as “an attempt to understand this era by painting it in the gaudy and garish colors it really deserves … This is part farce, part parable, and I do hope, though the Captain bears more than a passing resemblance to Trump, that the book will be readable when Trump is gone. That’s part of the reason I called it “An entertainment” on the title page. It’s a nod to Graham Greene but also the way I hope people will read it. It was cathartic to write and I hope cathartic to read. ” As with The Parade, reviews were decidedly mixed, with much criticism noting that Eggers’ satire struggled to keep up with or do justice to the events of the Trump era. In a review for the Financial Times, Carl Wilkinson expressed bemusement about the purpose of the book and its intentions, Hannah Barekat in The Spectator was critical for the “heavy handed” nature of the book’s satire, while The Guardian, Times Literary Supplement, and Kirkus also found the book wanting.