In 1982 and 1983, Xenophon worked as a lawyer in the private practice of Jacob van Dissel. In 1984, van Dissel gave Xenophon the personal injury part of his practice, enabling Xenophon to become principal of his new firm, Xenophon & Co. Lawyers. The firm continues and deals primarily with workers compensation and personal injury claims on a no-win-no-fee basis.

In 1990, Xenophon married physiotherapist Sandra Kazubiernis. When their only child was born in 1992, Xenophon changed his own surname by deed poll from Xenophou to Xenophon; his paternal grandfather’s surname. Kazubiernis and Xenophon separated in 1995 and later divorced.

In 1992, after the Bannon Labor government passed legislation that saw the introduction of poker machines (pokies) into South Australia in 1994 the increased incidence of problem gambling came to Xenophon’s attention in his legal practice.

In 1994 and 1997, Xenophon served as President of the South Australian branch of the Australian Plaintiff Lawyers’ Association. During this time, Xenophon also taught law at the University of South Australia, where future political opponent Christopher Pyne was among his students.

At the 1997 state election, Xenophon stood for the South Australian Legislative Council under an Independent No Pokies ticket, advocating the reduction and abolition of poker machines (colloquially known as “pokies”). He received a vote of 2.86 percent, a statewide total of 25,630 votes – much less than the 8.33 per cent needed to be elected in his own right – but by receiving a large number of preferences first from microparties and then from Grey Power, he went from a quota of 0.34 to 1.08 and was therefore elected. This made Xenophon the first independent elected to the Legislative Council in 60 years.

Following the 1997 election, the Olsen Liberal government needed the support of an additional two non-Liberal upper house members in order to pass legislation, with the Australian Democrats retaining the balance of power on three seats. However, defectors from Labor in the upper house, Terry Cameron and Trevor Crothers, often brought Xenophon in to play. In 1998, Xenophon voted with Cameron and the government to proceed with the second reading of the ETSA power sale bill. The bill became law when Cameron and Crothers voted with the Liberal government, although Xenophon voted against the bill in its final form. Following the election of the Rann Labor government at the 2002 state election, the government needed an additional five non-Labor upper house members to pass legislation, giving a shared balance of power to the Democrats on three seats, incumbent independents Xenophon and Cameron, with the Family First Party winning their first seat.

At the 2006 state election, he ran an aggressive campaign and attracted considerable publicity through a range of imaginative stunts, including riding a model locomotive “gravy train” outside Parliament House to protest MPs’ superannuation entitlements, parading along Rundle Mall wearing a sandwich board to advertise his campaign, and bringing a small goat to Parliament urging voters not to “kid around” with their vote. Despite media speculation that he would struggle to be re-elected due to the major parties preferencing against him, he attracted sufficient funding and volunteers to staff most state booths on polling day. He received 190,958 first preferences or 20.51 per cent of the total vote, enough to not only be re-elected himself, but also to elect the second No Pokies candidate, Ann Bressington. His total was 5.46 per cent less than the Liberal Party, and he outpolled the Liberals in some booths, including the electoral district of Enfield. With the Labor government needing four non-Labor upper house members to pass legislation, No Pokies on two seats shared the balance of power with Family First on two seats, the Democrats on one seat, with the SA Greens winning their first seat.

As Xenophon had vacated his Legislative Council seat to run for the Senate, a joint sitting of the South Australian parliament was convened for 21 November 2007 to select Xenophon’s replacement. Former valuer-general John Darley, who had stood as the third candidate on Xenophon’s ticket in 2006, was appointed. During the joint sitting convened to confirm the nomination, Ann Bressington criticised Xenophon, questioning his integrity and suitability for federal parliament, suggesting that his “anti-politician” image was more spin than reality. She also said Xenophon had demanded she contribute $50,000 towards campaign expenses at the 2006 state election. Xenophon said in response that he was “shocked and hurt” and “deeply upset” that she had failed to share her concerns with him in person, saying “privately and publicly, I have been very supportive of her.” Some people whose causes Xenophon had championed also came forward to defend Xenophon, like Di Gilcrist, whose husband’s hit and run death resulted in the Kapunda Road Royal Commission. In an interview the following day, Ms Gilcrist said “based on my experience not only as a victim who’s dealt with Nick but also somebody who’s worked with Nick and his office… Nick is passionate and he cares and he is empathetic. And he is truly committed.” Lower House independent Kris Hanna also defended Xenophon, arguing Bressington had “obviously been out to do some damage” and injure Xenophon’s election chances.

On 11 October 2007, Xenophon called a press conference at the Adelaide Zoo in front of the giraffe enclosure, declaring he would “stick his neck out for South Australia” by announcing his resignation from the South Australian Legislative Council in an attempt to gain election to the Australian Senate at the 2007 federal election. His platform consisted of anti-gambling and consumer protection measures, attention to the water crisis affecting the Murray River, ratifying Kyoto, opposition against a “decrease in state rights”, and opposition to WorkChoices. Nick Minchin, a Liberal senator from South Australia, urged people not to vote for Xenophon. Due to running as an independent Xenophon’s name did not appear above the line on the ticket, instead he was represented only by the letter “S” above the line, with voters having to search for his details.

In 2008, The Australian quoted many Liberal and Labor politicians who believed Xenophon had shown himself to be a “lightweight” political opportunist during his decade in state politics.

In February 2009, the Rudd Government needed to pass its $42 billion economic stimulus package. Xenophon initially voted against the package, but ultimately voted in favour after amendments were made. Xenophon persuaded the government to bring forward $900 million in Murray-Darling basin funds and other water projects, which included $500 million over three years for water buybacks.

In November 2009, Xenophon labelled the Church of Scientology as a criminal organisation, alleging members had experienced blackmail, torture and violence, labour camps and forced imprisonment, and coerced abortions. On 7 September 2010, a Senate committee recommended that a charities commission be formed with the purpose of investigating and monitoring transparency of charitable organisations. This recommendation received bipartisan support.

In July 2011, Xenophon lost the balance of power to the Greens, however his anti-pokies stance was bolstered when independent Andrew Wilkie was elected to the lower house at the 2010 election, resulting in a hung parliament. Wilkie had campaigned heavily against pokies at the election. In exchange for Wilkie’s support, the Gillard Government legislated for mandatory precommitment technology which would require people using high-bet machines to pre-commit how much they were willing to bet on a machine before actually playing, as well as introducing safer $1 maximum bet per spin machines, which would not require pre-commitment. The plan came under sustained attack from sporting clubs and various businesses that financially benefit from poker machine use.

In September 2011, Xenophon controversially used parliamentary privilege to accuse a Catholic priest of rape, in regard to accusations around events that occurred in the 1960s. He also accused Monsignor David Cappo and Philip Wilson, the Catholic Archbishop of Adelaide, of failing to properly investigate the allegations in 2007. All three men denied the senator’s claims. Xenophon chose such action after receiving an “unsatisfactory” response from the Church when advising them of his intentions and ultimatum. Cappo subsequently stepped down from several of his public positions. Several days later, after high-level media coverage, Xenophon indicated he might not have used parliamentary privilege had he known the person he accused was about to take a period of leave.

In November 2011, Xenophon voted against the Clean Energy Bill. The carbon pricing scheme passed with the Labor government receiving Green support for the legislation in the Senate.

In 2012, Xenophon co-sponsored a bill with Victorian Senator John Madigan to restrict federal government subsidies for wind farms. Xenophon’s concerns about wind turbines were predominantly related to anecdotal evidence of health problems and the reliability of wind-sourced power.

In May 2012, Xenophon – a vocal supporter of opposition leader Anwar Ibrahim – visited Malaysia to independently observe anti-government protests. The New Straits Times questioned Xenophon’s impartiality in an article, which included part of his 2009 speech criticizing Scientology. The newspaper replaced Scientology with the word Islam. Xenophon threatened to sue for defamation, and the article was removed from the newspaper’s website.

In February 2013, Xenophon attempted independently to revisit Malaysia but was refused entry by immigration authorities and detained. He was later sent back to Australia. It was confirmed that Xenophon was not on an Australian Delegation list scheduled to meet the Malaysian parliamentary affairs minister.

During the 2013 federal election, Xenophon nominated four key policy issues; gaming machine reforms, stopping palm oil from being sold in Australia, breaking up the supermarket duopoly, and better deals for Riverland irrigators in the Murray-Darling basin rescue plan. Xenophon’s voting result increased to 24.9 percent, a few percent short of two quotas. A record number of candidates stood at the election. Group voting tickets came under scrutiny because multiple candidates were provisionally elected with the vast majority of their 14.3 percent quotas coming from the preferences of other parties across the political spectrum.

After returning to a balance of power position in the Senate, Xenophon focused on defence materiel, particularly the Collins-class submarine replacement project, and cuts made by the Abbott Government in the 2014 Australian federal budget.

In October 2014, Xenophon supported the Abbott Government’s Direct Action plan for combatting Climate Change, enabling it to pass the Senate. However, he later stated that the plan had been “neutered” because of changes made to it via regulation.

In December 2014, Xenophon voted against the tertiary education reforms proposed by Minister for Education and Training Christopher Pyne which would have seen a shift towards privatisation of universities in Australia.

According to Xenophon, the party politics of the On Dit incident disenchanted him, although some Labor members maintain that he considered joining the Australian Labor Party while at university. In 2015, the publishers of former Labor Prime Minister Julia Gillard’s 2014 memoir My Story retracted a false allegation that Xenophon had been “infamously excluded from university for a period as punishment for stuffing a ballot box full of voting papers he had somehow procured”.

In 2015, Xenophon appealed in person to Indonesia’s largest Islamic body to support a reprieve for two Australian convicted drug smugglers sentenced to death in Bali. Xenophon’s translator reportedly stated, “We are aware that the death penalty is the right of the Indonesian government. Therefore, we do not ask that it be cancelled but plead that it be delayed”.

In March 2015, Xenophon opposed the amendments to the national security legislative framework, particularly on the issue of telecommunications data retention. In his 2014 “spycatcher” speech to the Senate, Xenophon stated that the new laws would have a chilling effect on investigative journalism in Australia. Xenophon negotiated with then Minister for Immigration and Border Protection Scott Morrison for the reintroduction of the Temporary Protection Visa.

In March 2015, Xenophon independently travelled to Indonesia with an Adelaide sheikh to unconvincingly seek clemency for the Bali Nine duo who were on death row.

In November 2015, Xenophon joined calls for a royal commission into the Australia-East Timor spying scandal.

In February 2016, Xenophon joined with the Australian Greens and the Government to support a reform of the Senate election system. Other crossbench senators, including John Madigan and David Leyonhjelm, whose re-election prospects would be bleak under the new voting arrangements, accused Xenophon of “political trickery of the highest order”.

During the 2016 federal election campaign, Xenophon was the subject of attacks from both major political parties, including his failure to declare a directorship of Adelaide Tower Pty Ltd, which involved his father. Xenophon accused proponents of a “partisan and personal campaign”. Labor requested the Australian Electoral Commission investigate questionable loans given to Xenophon by businessman Ian Melrose.

In August 2016, Xenophon and NXT colleagues opposed the proposed same-sex marriage plebiscite on the basis that it was not binding and a waste of public resources.

In March 2017, Xenophon announced that he would launch a new party in time for the 2018 South Australian state election. In July 2017, Nick Xenophon’s SA-BEST was registered by the Electoral Commission of South Australia.

In August 2017, Xenophon became embroiled in the 2017 Australian parliamentary eligibility crisis and asked to be referred to the High Court for clarification of his 2016 eligibility. On 27 October 2017, the High Court found he had been eligible in 2016 to nominate and be validly elected.

In September 2017, the Turnbull Government with the support of Nick Xenophon (by a vote of 31-27), was able to pass changes to media legislation including the repealing of the “two-out-of-three” rule (which allowed a company to own a TV station, newspaper and radio station in a single market) and the “reach rule” (which prevented a single TV broadcaster from reaching more than seventy-five per cent of the population).

On 6 October 2017, Xenophon announced that he would resign in order to stand for the Parliament of South Australia at the 2018 South Australian general election. On 31 October 2017, Xenophon resigned from the Senate, and was replaced by his party’s senior advisor Rex Patrick.

On 19 August 2017, Xenophon announced that British authorities had confirmed that he was a British Overseas Citizen because his ethnic Greek father was born in Cyprus when it was a British colony. Xenophon’s subsequent application to renounce that citizenship became effective on 30 August. Separately, Xenophon later said that he had already renounced Greek citizenship acquired through his mother. Xenophon asked the Australian government to have him referred to the High Court in the Court of Disputed Returns for consideration and clarification of his 2016 eligibility. On 27 October 2017, the High Court found that Xenophon had been eligible in 2016 to nominate and be validly elected.

In 2017, former staffer Jenny Low claimed, in response to an article appearing in The Australian, that she had been in a seven-year secret relationship with Xenophon that was psychologically abusive, “destructive” and detrimental to her career. Xenophon admitted that a relationship had commenced in 2007, but rejected any negative assertions.

On 17 March 2018, Xenophon unsuccessfully contested the seat of Hartley in the South Australian House of Assembly at the 2018 South Australian state election. Although he came second on the primary vote ahead of Labor’s Grace Portolesi by 202 votes, upon the preference distribution of the eliminated fourth-placed Greens candidate, Xenophon’s 99 vote lead over Labor became a 357-vote deficit. Third-placed Xenophon was therefore eliminated, with Hartley reverting to the traditional Liberal vs Labor contest.

In 2019, it was reported by the Australian Financial Review that his law firm was representing Chinese telecommunications firm Huawei, who he claims have “been treated incredibly unfairly”.

On 2 December 2019 Huawei Australia announced that it had engaged Xenophon’s services as an “external lawyer”. The company had been banned by the Australian government from providing 5G infrastructure, and was seeking to have that policy revised. Xenophon denied that he was acting as a lobbyist.