Born in Maryon Road, Charlton, Kent (now part of south-east London), England, Petrie was the grandson of Captain Matthew Flinders, surveyor of the Australian coastline. He was raised in a devout Christian household (his father being Plymouth Brethren), and was educated at home. He had no formal education. His father taught his son how to survey accurately, laying the foundation for a career excavating and surveying ancient sites in Egypt and the Levant. Flinders Petrie was encouraged from childhood in his archaeological interests. At the age of eight he was being tutored in French, Latin, and Greek, until he had a collapse and became self-taught. He also ventured his first archaeological opinion aged eight, when friends visiting the Petrie family were describing the unearthing of Brading Roman villa in the Isle of Wight. The boy was horrified to hear the rough shovelling out of the contents, and protested that the earth should be pared away, inch by inch, to see all that was in it and how it lay. "All that I have done since," he wrote when he was in his late seventies," was there to begin with, so true it is that we can only develop what is born in the mind. I was already in archaeology by nature."

After surveying British prehistoric monuments in his teenage years (commencing with the late Romano-British 'British Camp' that lay within yards of his family home in Charlton) in attempts to understand their geometry (at 19 tackling Stonehenge), Petrie travelled to Egypt early in 1880 to apply the same principles in a survey of the Great Pyramid at Giza, making him the first to properly investigate how they were constructed (many theories had been advanced on this, and Petrie read them all, but none were based on first hand observation or logic). Petrie's published report of this triangulation survey, and his analysis of the architecture of Giza therein, was exemplary in its methodology and accuracy, and still provides much of the basic data regarding the pyramid plateau to this day. On that visit he was appalled by the rate of destruction of monuments (some listed in guidebooks had been worn away completely since then) and mummies. He described Egypt as "a house on fire, so rapid was the destruction" and felt his duty to be that of a "salvage man, to get all I could, as quickly as possible and then, when I was 60, I would sit and write it all down".

Having returned to England at the end of 1880, Petrie wrote a number of articles and then met Amelia Edwards, journalist and patron of the Egypt Exploration Fund (now the Egypt Exploration Society), who became his strong supporter and later appointed him as Professor at her Egyptology chair at University College London. Impressed by his scientific approach, they offered him work as the successor to Édouard Naville. Petrie accepted the position and was given the sum of £250 per month to cover the excavation’s expenses. In November 1884, Petrie arrived in Egypt to begin his excavations.

He first went to a New Kingdom site at Tanis, with 170 workmen. He cut out the middle man role of foreman on this and all subsequent excavations, taking complete overall control himself and removing pressure on the workmen from the foreman to find finds quickly but sloppily. Though he was regarded as an amateur and dilettante by more established Egyptologists, this made him popular with his workers, who found several small but significant finds that would have been lost under the old system. By the end of the Tanis dig he ran out of funding but, reluctant to leave the country in case this was renewed, he spent 1887 cruising the Nile taking photographs as a less subjective record than sketches. During this time he also climbed rope ladders at Sehel Island near Aswan to draw and photograph thousands of early Egyptian inscriptions on a cliff face, recording embassies to Nubia, famines and wars. By the time he reached Aswan, a telegram had reached there to confirm the renewal of his funding. He then went straight to the burial site at Fayum, particularly interested in post-30 BC burials, which had not previously been fully studied. He found intact tombs and 60 of the famous portraits, and discovered from inscriptions on the mummies that they were kept with their living families for generations before burial. Under Auguste Mariette's arrangements, he sent 50% of these portraits to the Egyptian department of antiquities. However, later finding that Gaston Maspero placed little value on them and left them open to the elements in a yard behind the museum to deteriorate, he angrily demanded that they all be returned, forcing Maspero to pick the 12 best examples for the museum to keep and then returning 48 to Petrie, which he sent to London for a special showing at the British Museum. Resuming work, he discovered the village of the Pharaonic tomb-workers.

In 1890, Petrie made the first of his many forays into Palestine, leading to much important archaeological work. His six-week excavation of Tell el-Hesi (which was mistakenly identified as Lachish) that year represents the first scientific excavation of an archaeological site in the Holy Land. At another point in the late nineteenth-century, Petrie surveyed a group of tombs in the Wadi al-Rababah (the biblical Hinnom) of Jerusalem, largely dating to the Iron Age and early Roman periods. Here, in these ancient monuments, Petrie discovered two different metrical systems. His involvement in Palestinian archaeology was examined in the exhibition "A Future for the Past: Petrie's Palestinian Collection".

Next, from 1891, he worked on the temple of Aten at Tell-el-Amarna, discovering a 300 square foot New Kingdom painted pavement of garden and animals and hunting scenes. This became a tourist attraction but, as there was no direct access to the site, tourists wrecked neighbouring fields on their way to it. This made local farmers deface the paintings, and it is only thanks to Petrie's paintings that their original state is known.

The chair of Edwards Professor of Egyptian Archaeology and Philology at University College, London was set up and funded in 1892 by Amelia Edwards. Petrie's supporter since 1880, she made him its first holder. He continued to excavate in Egypt after taking up the professorship, training many of the best archaeologists of the day. In 1913 Petrie sold his large collection of Egyptian antiquities to University College, London, where it is now housed in the Petrie Museum of Egyptian Archaeology.

In early 1896, Petrie and his archaeological team were conducting excavations on a temple in Petrie's area of concession at Luxor. This temple complex was located just north of the original funerary temple of Amenhotep III which had been built on a flood plain. They were initially surprised that this building which they were excavating:

'was also attributed to Amenophis III since only his name appeared on blocks strewn over the site...Could one king have had two mortuary temples? Petrie dug and soon solved the puzzle: the temple had been built by Merenptah, the son and successor of Ramesses II, almost entirely from stone which had been plundered from the temple of Amenophis III nearby. Statues of the latter had been smashed and the pieces thrown into the foundations; fragments of couchant stone jackals, which must have once formed an imposing avenue approaching the pylon, and broken drums gave some idea of the splendour of the original temple. A statue of Merenptah himself was found--the first known portrait of this king....Better was to follow: two splendid stelae were found, both of them usurped on the reverse side by Merenptah, who had turned them face to the wall. One, beautifully carved, showed Amenophis III in battle with Nubians and Syrians; the other, of black granite, was over ten feet high, larger than any stela previously known; the original text commemorated the building achievements of Amenophis and described the beauties and magnificence of the temple in which it had stood. When it could be turned over an inscription of Merenptah recording his triumphs over the Libyans and the Peoples of the Sea was revealed; [Wilhelm] Spiegelberg [a noted German philologist] came over to read it, and near the end of the text he was puzzled by one, that of a people or tribe whom Merenptah had victoriously smitten--"I.si.ri.ar?" It was Petrie whose quick imaginative mind leapt[t] to the solution: "Israel!" Spiegelberg agreed that it must be so. "Won't the reverends be pleased?" was his comment. At dinner that evening Petrie prophesied: "This stele will be better known in the world than anything else I have found." It was the first mention of the word "Israel" in any Egyptian text and the news made headlines when it reached the English papers.'

1923 saw Petrie knighted for services to British archaeology and Egyptology. In 1926, the focus of Petrie’s work shifted permanently to Palestine (though he did become interested in early Egypt, in 1928 digging a cemetery at Luxor which proved so huge that he devised an entirely new excavation system, including comparison charts for finds which are still used today). He began excavating several important sites in the southwestern region of Palestine, including Tell el-Jemmeh and Tell el-Ajjul. In 1933, on retiring from his professorship, he moved permanently to Jerusalem, where he lived with Lady Petrie at the British School of Archaeology, then temporarily headquartered at the American School of Oriental Research (today called the Albright Institute).