Christian was born in 1503 at Gottorf Castle which Frederick I had made a primary residence. In 1514, when he was just ten years old, Christian's mother died. Four years later, his father remarried to Sophie of Pomerania (1498 – 1568).

Frederick was elected king of Denmark in the place of his nephew, Christian II in 1523. The young prince Christian's first public service after his father became king was the reduction of Copenhagen, which stood firm for the fugitive Christian II. As stadtholder of the Duchies of Holstein and Schleswig in 1526, and as viceroy of Norway in 1529, Christian III displayed considerable administrative ability.

Christian's earliest teacher, Wolfgang von Utenhof, and his Lutheran tutor, Johann Rantzau, were both able and zealous reformers who had a profound influence on the young prince. At their urging, while traveling in Germany in 1521, he made himself present at the Diet of Worms to hear Martin Luther speak. Luther's arguments profoundly intrigued him. The prince made no secret of his Lutheran views, and his outspokenness brought him into conflict, not only with the Catholic Rigsraad, but also with his cautious and temporizing father. At his own court at Schleswig he did his best to introduce the Protestant Reformation, despite the opposition of the bishops. There was some talk of passing him over in the succession to the throne in favour of his younger half-brother John the Elder (Hans den Ældre), who had been brought up in the old religion.

After his father's death, in 1533, Christian was proclaimed king at an assembly in Rye, a town in eastern Jutland, in 1534. The Danish State Council (rigsraad), dominated by the Catholic bishops and nobles, refused to accept Duke Christian as king and turned to Count Christopher of Oldenburg in order to restore the staunchly Catholic Christian II to the Danish throne. In opposition of King Christian III, Count Christopher was proclaimed regent at the Ringsted Assembly (landsting), and at the Skåne Assembly (landsting) at St Liber's Hill at Lund Cathedral.

This resulted in a two-year civil war, known as the Count's Feud (Grevens Fejde) (1534 – 1536), between Protestant and Catholic forces. Count Christopher had the support of most of Zealand, Scania, the Hanseatic League, and the peasants of northern Jutland and Funen. Christian III found his support among the nobles of Jutland. In 1534, as the army swept south, the Catholic peasants under Skipper Clement began an uprising in northern Jutland. They burned the manor houses and pillaged the holdings of Lutheran nobles. An army of nobles and their men assembled at Svendstrup and suffered a terrible defeat at the hands of the peasants. Realizing his hold on the throne was in imminent danger, Christian III negotiated a deal with the Hansa States which allowed him to send his trusted advisor Johan Rantzau north with an army of German mercenaries. Clement and his army fled north, taking refuge inside the walls of Aalborg. In December, Rantzau's forces stormed the city and breached the walls. In the following days 3,000 people were massacred, and the city plundered by the Germans. Clement managed to escape the slaughter, but was apprehended a few days later. He was tried and beheaded in 1535. His body was cut apart and placed on a sty, a lead crown was placed on Clement's spiked head. With Jutland more or less secure, Christian next focused on gaining control of Scania. He appealed to King Gustav Vasa for help in subduing the rebels. Gustav immediately obliged by sending two armies to ravage central Scania and Halland. The peasants suffered a bloody defeat at Loshult. The Swedes moved against Helsingborg Castle, which surrendered in January 1535. Helsingborg was burned to the ground in retaliation. Rantzau moved his army to Funen and defeated Count Christopher's army at Øksnebjerg in June 1535. Count Christopher's forces held out in Malmø and Copenhagen until July 1536 when they surrendered after several months of siege by Christian II's forces. When they capitulated, Christian III was firmly on Denmark's throne, and the Catholic forces in Denmark subdued.

A mutual confidence between a king who had conquered his kingdom and a people who had stood in arms against him was not attainable immediately. The circumstances under which Christian III ascended the throne exposed Denmark to the danger of foreign domination. It was with the help of the gentry of the duchies that Christian had conquered Denmark. German and Holsatian noblemen had led his armies and directed his diplomacy. The first six years of Christian III's reign were marked by a contest between the Danish Rigsraadet and the German counsellors, both of whom sought to rule the pious king exclusively. Though the Danish party won a signal victory at the outset, by obtaining the insertion in the charter of provisions stipulating that only native-born Danes should fill the highest dignities of the state, the king's German counsellors continued paramount during the earlier years of his reign.

The triumph of a reformer like Christian III would bring about an end to Catholicism in Denmark, but Catholics still controlled the Council of State. Christian ordered the arrest of three of the bishops on the State Council by his German mercenaries (12 August 1536). Martin Luther wrote to the king congratulating him on his success. Christian's debt for the Count's Feud was enormous and confiscating the immense property of the bishops immediately enabled him to pay down the debt to his creditors. The ultimate gainers by the confiscation were the nobles. Christian's Protestant enthusiasm swept Denmark toward the establishment of the Danish Lutheran Church as the national church of Denmark (Folkekirke). This occurred officially on 30 October 1536 when the reconstituted State Council adopted the Lutheran Ordinances designed by Johannes Bugenhagen, which outlined church organization, liturgy, and accepted religious practice. Monasteries, nunneries, priories were closed and the property taken by the crown (the Expulsion of the Grayfriars). Vast tracts of land were handed out to the king's supporters. Superfluous churches were closed, cathedral schools terminated, and recalcitrant priests turned out of their parishes. Catholic bishops were imprisoned until they agreed to marry and give up their privileges. Most submitted after years of imprisonment. Some refused to accept church reforms and died in prison.

The ultimate triumph of the Danish party dates from 1539. The dangers threatening Christian III from the emperor Charles V and other kinsmen of the imprisoned Christian II convincing him of the absolute necessity of removing the last trace of discontent in the land by leaning exclusively on Danish magnates and soldiers. The complete identification of the Danish king with the Danish people was accomplished at the Herredag of Copenhagen, 1542, when the nobility of Denmark voted Christian a twentieth part of all their property to pay off his heavy debt to the Holsatians and Germans.

The pivot of the foreign policy of Christian III was his alliance with the German Protestant princes, as a counterpoise to the persistent hostility of Charles V, who was determined to support the hereditary claims of his nieces, the daughters of Christian II, to the Scandinavian kingdoms. War was declared against Charles V in 1542, and, though the German Protestant princes proved faithless allies, the closing of the Sound against Dutch shipping proved such an effective weapon in King Christian's hand that the Netherlands compelled Charles V to make peace with Denmark at the diet of Speyer, on 23 May 1544. Until this peace, Christian III ruled the entire Duchies of Holstein and of Schleswig also in the name of his then still minor half-brothers John the Elder (Hans den Ældre) and Adolf. They determined their youngest brother Frederick, Prince of Denmark, for a career as Lutheran administrator of an ecclesiastical state within the Holy Roman Empire.

In 1544 the elder three brothers partitioned Holstein (a fief of the Holy Roman Empire) and Schleswig (a Danish fief) in an unusual way, following negotiations between the brothers and the Estates of the Realm of the duchies, which opposed a factual partition. So the revenues of the duchies were divided into three equal shares by assigning the revenues of particular areas and landed estates to each of the elder brothers, while other general revenues, such as taxes from towns and customs dues, were levied together but then shared among the brothers. The estates, whose revenues were assigned to the parties, made Holstein and Schleswig look like patchworks, technically inhibiting the emergence of separate new duchies, as intended by the estates of the duchies. The secular rule in the fiscally divided duchies thus became a condominium of the parties. As an effect both separate duchies, Holstein and Schleswig, with shares of each party scattered in both duchies, provided them with a condominial government binding both together, partially superseding their legally different affiliation as Holy Roman and Danish fiefs. As dukes of Holstein and Schleswig, the three brothers bore the formal title of "Duke of Schleswig, Holstein, Ditmarsh and Stormarn". John the Elder conveniently called Duke of Schleswig-Holstein-Haderslev produced no issue, so no branch emerged from his side. Adolf founded a cadet branch of the royal Danish House of Oldenburg called House of Holstein-Gottorp, a convenient usage for the technically more correct Duke of Schleswig and Holstein at Gottorp.

Similarly Christian III's youngest son John the Younger gained for him and his heirs a share in Holstein's and Schleswig's revenues in 1564, comprising a third of the royal share, thus a ninth of Holstein and Schleswig as to the fiscal point of view. John the Younger and his heirs, however, had no share in the condominial rule.

The foreign policy of Christian's later days was regulated by the peace of Speyer. He carefully avoided all foreign complications; refused to participate in the Schmalkaldic war of 1546; mediated between the emperor and Saxony after the fall of Maurice of Saxony at the Battle of Sievershausen in 1553, and contributed essentially to the conclusion of peace.

A strong sense of duty, genuine piety, and a cautious common sense coloured every action of his eventful life. The nation he left behind was perhaps the best proof of his statesmanship. At the end of his Reign, Denmark was stronger, more unified, and wealthier than it had ever been before. King Christian III died on New Year's Day 1559 at Koldinghus and was interred in Roskilde Cathedral.