At the age 26, Bhatt made his debut as a director with the film Manzilein Aur Bhi Hain in 1974. His 1979 Lahu Ke Do Rang, starring Shabana Azmi and Vinod Khanna in lead roles, won two Filmfare Awards in 1980: Helen received her first Filmfare as Best Supporting Actress and Madhukar Shinde won it for Best Art Direction. The film did “above average” at the box office. He was noticed and received great critical acclaim with art film Arth (1982), when he turned to his personal life for inspiration but doubt persists as to whether it is an original film. Later, he made many more films taking insights from his personal life wherein he highlighted personal narratives ranging from out-of-wedlock birth to extramarital affair, and created critically acclaimed works such as Janam (1985) and Saaransh (1984), an exploration of an old couple’s anxieties in a universe governed by arbitrary violence.

Bhatt married Lorraine Bright when he was 20 years old. His romance with her was the inspiration for his film Aashiqui. Bright changed her name to Kiran Bhatt. The couple have two children, a daughter Pooja Bhatt, a former actress, now a producer, and a son Rahul Bhatt, an aspiring actor. The marriage ended when Mahesh Bhatt had an affair with 1970s actress, Parveen Babi. The affair did not last long. Bhatt later married Soni Razdan in 1986. The couple have two daughters, Shaheen Bhatt and Alia Bhatt. Emraan Hashmi is his cousin Anwar Hashmi’s son and thus his nephew.

In the 1970s, he became a follower of Osho, and later found spiritual companionship and guidance with philosopher, U.G. Krishnamurti. Bhatt calls Krishnamurti his lifeline and says “Take him away, and I am empty”. Bhatt in 1992 wrote Krishnamurti’s biography titled U.G. Krishnamurti, A Life. Apart from this he has edited several books based on conversations with U.G. Krishnamurti. Bhatt’s latest book A Taste of Life: The Last Days of U.G. Krishnamurti was published in June 2009.

In 1995 he moved to television, then a newly opening medium in India. He made two TV series in 1995: the English language A Mouthful of Sky written by Ashok Banker and the popular Hindi language serial Swabhimaan scripted by the writer Shobha De. He directed another TV series, Kabhie Kabhie, in 1997 which was written by Anurag Kashyap, Vinta Nanda and Kamlesh Kunti Singh. Following this, he directed dramas like Dastak (1996), the debut film of Miss Universe 1994-turned-actress Sushmita Sen, and Tamanna (1997), and tried his hand at comedy with Duplicate in 1998. Zakhm (1998) based on the Mumbai riots of 1993.

His last film as director was Kartoos (1999) which did average business at the box office. Thereafter, Bhatt retired a director and took to screenwriting, churning out stories and screenplays for over twenty films, many of which were box-office successes, like Dushman, Raaz, Murder (2004), Gangster (2006), Woh Lamhe (2006), based on the life of actress Parveen Babi, along with many more. His banner vishesh films still continues operating today as one of Indian Cinemas leading production banners. Bhatt entered into the world of theatre with his protege Imran Zahid as of now he has produced three plays. The Last Salute, based on Muntadhar al-Zaidi’s book of the same title, a journalist investigating atrocities Trial of Errors, that opened on 29 March 2013 in Delhi. stage adaptation of Bhatt of his movie, Arth (film). Bhatt also produced The Last Salute, a play directed by Arvind Gaur, based on Muntadhar al-Zaidi’s book, starring Imran Zahid.

Bhatt believes the Congress party is committed to secularism. In the 2014 Lok Sabha elections, he campaigned in a Karvan-e-Bedari (caravan of awareness) asking people to vote for Congress and defeat BJP’s Prime Ministerial candidate Narendra Modi, as he believes that Mr. Modi is communal. Bhatt also criticizes the communal record of Congress Party, for its role in 1984 Sikh riots. He is planning to make a film, which will address the riots that took place in Delhi. Mahesh Bhatt supported the Islamist preacher Zakir Naik when the latter was denied entry into the United Kingdom for his controversial comments on terrorism.