Zahir Shah was born on 15 October 1914, in a city quarter called Deh Afghanan (Afghans village) in Kabul, Afghanistan. He was the son of Mohammed Nadir Shah (1883-1933) a senior member of the Muhamadzai Royal family and commander in chief of the Afghan Army for former king Amanullah Khan, and of Begum Mah Parwar Begum (d. 1941), a Persian-speaking woman. Nadir Shah assumed the throne after the execution of Habibullah Kalakani on 1 November 1929. Mohammed Zahir’s father, son of Sardar Mohammad Yusuf Khan, was born in Dehradun, British India, his family having been exiled after the Second Anglo-Afghan War. Nadir Shah was a descendant of Sardar Sultan Mohammed Khan Telai, half-brother of Emir Dost Mohammad Khan. His grandfather Mohammad Yahya Khan (father in law of Emir Yaqub Khan) was in charge of the negotiations with the British resulting in the Treaty of Gandamak. After the British invasion after the killing of Sir Louis Cavagnari during 1879, Yaqub Khan, Yahya Khan and his sons, Princes Mohammad Yusuf Khan and Mohammad Asef Khan, were seized by the British and transferred to the British Raj, where they remained forcibly until the two princes were invited back to Afghanistan by Emir Abdur Rahman Khan during the last year of his reign (1901). During the reign of Amir Habibullah they received the title of Companions of the King (Musahiban).

He married his first cousin Humaira Begum (1918–2002) on 7 November 1931 in Kabul. They had six sons and two daughters:

Zahir Khan was proclaimed king (shah) on 8 November 1933 at the age of 19, after the assassination of his father Mohammed Nadir Shah. After his ascension to the throne he was given the regnal title “He who puts his trust in God, follower of the firm religion of Islam”. For the first almost thirty years he did not effectively rule, ceding power to his paternal uncles, Mohammad Hashim Khan and Shah Mahmud Khan, both serving as prime ministers. This period fostered a growth in Afghanistan’s relations with the international community as during 1934, Afghanistan joined the League of Nations while also receiving formal recognition from the United States. By the end of the 1930s, agreements on foreign assistance and trade had been reached with many countries, most notably with the ‘Axis powers’: Germany, Italy, and Japan.

Despite close relations to the Axis powers, Zahir Shah refused to take sides during World War II and Afghanistan remained one of the few countries in the world to remain neutral. From 1944 to 1947, Afghanistan experienced a series of revolts by various tribes. After the end of the Second World War, Zahir Shah recognised the need for the modernisation of Afghanistan and recruited a number of foreign advisers to assist with the process. During this period Afghanistan’s first modern university was founded. During his reign a number of potential advances and reforms were derailed as a result of factionalism and political infighting. He also requested financial aid from both the United States and the Soviet Union, and Afghanistan was one of few countries in the world to receive aid from both the Cold War enemies. In a 1969 interview, Zahir Shah said that he is “not a capitalist. But I also don’t want socialism. I don’t want socialism that would bring about the kind of situation [that exists] in Czechoslovakia. I don’t want us to become the servants of Russia or China or the servant of any other place.”

Amid civilian and military discontent over the regime, in 1973 while Zahir Shah was abroad in Italy his cousin Mohammed Daoud Khan staged a non-violent military coup d’état and established a republican government. As a former Prime Minister, Daoud Khan had been forced to resign by Zahir Shah a decade earlier and felt that Zahir Shah lacked leadership and that the parliamentary system prevented real progressivism. In August 1973, Zahir Shah sent a letter from Rome to Khan in Kabul declaring his abdication, saying he respected “the will of my compatriots” after realizing the people of Afghanistan “with absolute majority welcomed a Republican regime”.

Zahir Shah was able to govern on his own during 1963 and despite the factionalism and political infighting a new constitution was introduced during 1964 which made Afghanistan a modern democratic state by introducing free elections, a parliament, civil rights, women’s rights and universal suffrage. However the new system of governance was unstable and Zahir Shah acted cautious in the reforms. Some groups believe these moves paved the way for the eventual communist takeover in 1978.

Zahir Shah lived in exile in Italy for twenty-nine years in a villa in the affluent community of Olgiata on Via Cassia, north of Rome, where he spent his time playing golf and chess, as well as tending to his garden. He was financially supported by the Shah of Iran since the new Afghan government failed to provide him a monthly salary. Shah also supported his two sons who were studying in US and Canada. He was prohibited from returning to Afghanistan during the late 1970s by the Soviet-assisted Communist government. In 1983 during the Soviet–Afghan War, Zahir Shah was cautiously involved with plans to develop a government in exile. Ultimately these plans failed because he could not reach a consensus with powerful Islamist factions. It has also been reported that Afghanistan, the Soviet Union and India had all tried to persuade Zahir Shah to return as chief of a neutral, possibly interim, administration in Kabul. Both the Soviet Union and the United States sent representatives to meet him, and President Mohammed Najibullah supported Zahir Shah to play a role in a possible interim government in the quest for peace. In May 1990, Zahir Shah issued a long statement through Voice of America and the BBC calling for unity and peace among Afghans, and offering his services. This reportedly led to a spark of interest and approval among the Kabul populace. However, the idea of a revived political role for Zahir Shah was met with hostility by some, notably radical Islamist Gulbuddin Hekmatyar.

In 1991, Zahir Shah survived an attempt on his life by a knife-wielding assassin masquerading as a Portuguese journalist. After the fall of the pro-Soviet government, Zahir Shah was favored by many to return and restore the monarchy to unify the country and as he was acceptable to most factions. However these efforts were blocked mostly by Pakistan’s ISI, who feared his stance on the Durand Line issue. In June 1995, Zahir Shah’s former envoy Sardar Wali announced at talks in Islamabad, Pakistan, that Zahir Shah was willing to participate in peace talks to end the Afghan Civil War, but no consensus was ever reached.

By the time he returned to Afghanistan in 2002, his rule was characterized by a lengthy span of peace.

On 18 April 2002, at the age of 87 and four months after the end of Taliban rule, Zahir Shah returned to Afghanistan, flown in an Italian military plane, and welcomed at Kabul’s airport by Hamid Karzai and other officials. His return was widely welcomed by Afghans, and he was liked by all ethnic groups. There were proposals for a return to the monarchy – Zahir Shah himself let it be known that he would accept whatever responsibility was given him by the Loya Jirga, which he initiated in June 2002. However he was obliged to publicly renounce monarchical leadership at the behest of the United States as many of the delegates to the Loya Jirga were prepared to vote for Zahir Shah and block the U.S.-backed Hamid Karzai. While he was prepared to become chief of state he made it known that it would not necessarily be as monarch: “I will accept the responsibility of head of state if that is what the Loya Jirga demands of me, but I have no intention to restore the monarchy. I do not care about the title of king. The people call me Baba and I prefer this title.” Karzai called Zahir Shah a “symbol of unity, a very kind man” and a “fatherly figure.”

Hamid Karzai, who was favored by Zahir Shah, became president of Afghanistan after the Loya Jirga. Karzai, from the Pashtun Popalzai clan, provided Zahir Shah’s relatives with major jobs in the transitional government. Following the Loya Jirga he was given the title “Father of the Nation” by Karzai, symbolizing his role in Afghanistan’s history as a symbol of national unity. This title ended with his death. In August 2002 he relocated back to his old palace after 29 years.

In an October 2002 visit to France, he slipped in a bathroom, bruising his ribs, and on 21 June 2003, while in France for a medical check-up, he broke his femur.

On 3 February 2004, Zahir was flown from Kabul to New Delhi, India, for medical treatment after complaining of an intestinal problem. He was hospitalized for two weeks and remained in New Delhi under observation. On 18 May 2004, he was brought to a hospital in the United Arab Emirates because of nose bleeding caused by heat.

On 23 July 2007, Zahir Shah died in the compound of the presidential palace in Kabul after prolonged illness. His death was announced on national television by President Karzai, who said “He was the servant of his people, the friend of his people, he was a very kind person, kind hearted. He believed in the rule of the people and in human rights.” His funeral was held on 24 July. It began on the premises of the presidential palace, where politicians and dignitaries paid their respects; his coffin was then taken to a mosque before being moved to the royal mausoleum on Maranjan Hill in eastern Kabul.

In January 2009 an article by Ahmad Majidyar of the American Enterprise Institute included one of his grandsons, Mustafa Zahir, on a list of fifteen possible candidates in the 2009 Afghan presidential election. However, Mostafa Zaher did not become a candidate.