Byatt was born as Antonia Susan Drabble, the daughter of John Drabble, QC, and Kathleen Bloor, a scholar of Browning. Byatt was educated at two independent schools, Sheffield High School and the Quaker Mount School, and noted in an interview in 2009 "I am not a Quaker, of course, because I'm anti-Christian and the Quakers are a form of Christianity but their religion is wonderful – you simply sat in silence and listened to the nature of things." She went on to Newnham College, Cambridge, Bryn Mawr in the United States, and Somerville College, Oxford.[4] Sister to novelist Margaret Drabble and art historian Helen Langdon, Byatt lectured in the Department of Extra-Mural Studies of London University (1962–71), the Central Saint Martins College of Art and Design and from 1972 to 1983 at University College London.

The story of a young girl growing up in the shadow of a dominant father, Byatt's first novel, The Shadow of the Sun, was published in 1964. Her novel The Game (1967) charts the dynamics between two sisters, and the family theme is continued in her quartet The Virgin in the Garden (1978), Still Life (1985), Babel Tower (1996), and A Whistling Woman (2002), Still Life winning the PEN/Macmillan Silver Pen Award in 1989. Her quartet of novels is inspired by D. H. Lawrence, particularly The Rainbow and Women in Love. Describing mid-20th-century Britain, the books follow the life of Frederica Potter, a young female intellectual studying at Cambridge at a time when women were heavily outnumbered by men at that university, and then tracing her journey as a divorcée with a young son making a new life in London. Byatt says some of the characters in her fiction represent her "greatest terror which is simple domesticity [...] I had this image of coming out from under and seeing the light for a bit and then being shut in a kitchen, which I think happened to women of my generation." Like Babel Tower, A Whistling Woman touches on the utopian and revolutionary dreams of the 1960s. She describes herself as "a naturally pessimistic animal": "I don't believe that human beings are basically good, so I think all utopian movements are doomed to fail, but I am interested in them."

She has written critical studies of Iris Murdoch, who was a friend, mentor and a significant influence on her own writing. In those books and other works, Byatt alludes to, and builds upon, themes from Romantic and Victorian literature. She conceives of fantasy as an alternative to, rather than an escape from, everyday life, and it is often difficult to tell when the fantastic in her work actually represents the eruption of psychosis. "In my work", she notes "writing is always so dangerous. It's very destructive. People who write books are destroyers." Possession (1990) parallels the emerging relationship of two contemporary academics with the past of two (fictional) nineteenth century poets whom they are researching. It won the Man Booker Prize in 1990 and was made into a film in 2002. Byatt's novel Angels & Insects also became a successful film, nominated for an Academy Award (1995). The Children's Book was shortlisted for the 2009 Man Booker Prize[5] and won the James Tait Black Memorial Prize.

Also known for her short stories, Byatt has been influenced by Henry James and George Eliot as well as Emily Dickinson, T. S. Eliot, and Robert Browning, in merging realism and naturalism with fantasy. Her story collections include Sugar and Other Stories (1987); The Djinn in the Nightingale's Eye (1994), a collection of fairy tales; Elementals: Stories of Fire and Ice (1998); and Little Black Book of Stories (2003). The Matisse Stories, (1993) features three pieces, each describing a painting by Henri Matisse, each the tale of an initially smaller crisis that shows the long-present unravelling in the protagonists’ lives. Her books reflect a continuous interest in zoology, entomology and Darwinism among other repeated themes. Byatt has written for media including the British journal Prospect, The Guardian, The Times and the Times Literary Supplement. She has been a judge on many literary award panels including the Hawthornden Prize, the Booker, David Higham Prize for Fiction, and the Betty Trask Award.

On the role of writing in her life, she says: "I think of writing simply in terms of pleasure. It's the most important thing in my life, making things. Much as I love my husband and my children, I love them only because I am the person who makes these things. I, who I am, is the person that has the project of making a thing. Well, that's putting it pompously – but constructing. I do see it in sort of three-dimensional structures. And because that person does that all the time, that person is able to love all these people."

A. S. Byatt married Ian Charles Rayner Byatt in 1959 and had a daughter, as well as a son who was killed in a car accident at the age of 11. The marriage was dissolved in 1969. She has two daughters with her second husband Peter John Duffy.
Byatt has been engaged in a feud with her novelist sister Margaret Drabble, since learning that Drabble wrote about their family's tea set, a tea set which Byatt had intended to write about herself. The two sisters have also disagreed about the appropriate portrayal of their mother. The pair seldom see each other and don't read each other's books.