Peter (or Pyotr) Kropotkin was born in Moscow. His father, Prince Alexei Petrovich Kropotkin, owned large tracts of land and nearly 1200 "souls" (male serfs) in three provinces. Kropotkin's male line traced to the legendary prince Rurik; his mother was the daughter of a Russian general. "[U]nder the influence of republican teachings," he dropped his princely title at the age of twelve, and "even rebuked his friends, when they so referred to him."

In 1857, at age 15, Kropotkin entered the Corps of Pages at St. Petersburg. Only 150 boys — mostly children of nobility belonging to the court — were educated in this privileged corps, which combined the character of a military school endowed with special rights and of a court institution attached to the imperial household. Kropotkin's memoirs detail the hazing and other abuse of pages for which the Corps had become notorious.

In Moscow, Kropotkin had developed an interest in the condition of the peasantry, and this interest increased as he grew older. In St. Petersburg, he read widely on his own account, and gave special attention to the works of the French encyclopædists and to French history. The years 1857 - 1861 witnessed a rich growth in the intellectual forces of Russia, and Kropotkin came under the influence of the new liberal - revolutionary literature, which largely expressed his own aspirations.

In 1862, Kropotkin was promoted from the Corps of Pages to the army. The members of the corps had the prescriptive right to choose the regiment to which they would be attached. For some time, he was aide de camp to the governor of Transbaikalia at Chita. Later he was appointed attaché for Cossack affairs to the governor general of East Siberia at Irkutsk.

Administrative work was scarce, and in 1864 Kropotkin accepted charge of a geographical survey expedition, crossing North Manchuria from Transbaikalia to the Amur, and soon was attached to another expedition which proceeded up the Sungari River into the heart of Manchuria. The expeditions yielded very valuable geographical results. The impossibility of obtaining any real administrative reforms in Siberia now induced Kropotkin to devote himself almost entirely to scientific exploration, in which he continued to be highly successful.

In 1867, he quit the army and returned to St. Petersburg, where he entered the university, becoming at the same time secretary to the geography section of the Russian Geographical Society. In 1871, he explored the glacial deposits of Finland and Sweden for the Society. In 1873, he published an important contribution to science, a map and paper in which he proved that the existing maps entirely misrepresented the physical features of Asia; the main structural lines were in fact from south-west to north-east, not from north to south, or from east to west as had been previously supposed. During this work, he was offered the secretaryship of the Society, but he had decided that it was his duty not to work at fresh discoveries but to aid in diffusing existing knowledge among the people at large. Accordingly, he refused the offer and returned to St. Petersburg, where he joined the revolutionary party.

He visited Switzerland in 1872 and became a member of the International Workingmen's Association (IWA) at Geneva. It was there that he found that he did not like IWA's style of socialism. Instead, he studied the programme of the more radical Jura federation at Neuchâtel and spent time in the company of the leading members, and definitely adopted the creed of anarchism. On returning to Russia, he took an active part in spreading revolutionary propaganda through the nihilist-led Circle of Tchaikovsky.

In 1873 Kropotkin was arrested and imprisoned in the Peter and Paul Fortress. He gained notoriety for his widely publicized escape from the prison in 1876, after which he went to England, moving after a short stay to Switzerland, where he joined the Jura Federation. In 1877 he moved to Paris, where he helped to start the socialist movement. In 1878 he returned to Switzerland, where he edited for Jura Federation's revolutionary newspaper Le Révolté, and published various revolutionary pamphlets. He was outspoken in his beliefs that the peasants were being treated unfairly and deserved to have the same land as the lords

In 1881 shortly after the assassination of Tsar Alexander II, the Swiss government expelled Kropotkin from Switzerland. After a short stay at Thonon (Savoy), he went to London, where he stayed nearly a year, and returned to Thonon in late 1882. Soon he was arrested by the French government, tried at Lyon, and sentenced by a police court magistrate (under a special law passed on the fall of the Paris Commune) to five years' imprisonment, on the ground that he had belonged to the IWA (1883). The French Chamber repeatedly agitated on his behalf, and he was released in 1886. He settled near London, living at various times in Harrow – where his daughter, Alexandra, was born – Ealing and Bromley (6 Cresent Road 1886 - 1914). He also lived for a number of years in Brighton. While living in London, Kropotkin became friends with a number of prominent English speaking socialists, including William Morris and George Bernard Shaw.

In 1902 Kropotkin published the book Mutual Aid: A Factor of Evolution, which provided an alternative view on animal and human survival, beyond the claims of interpersonal competition and natural hierarchy proffered at the time by some "social Darwinists", such as Francis Galton.

In the animal world we have seen that the vast majority of species live in societies, and that they find in association the best arms for the struggle for life: understood, of course, in its wide Darwinian sense – not as a struggle for the sheer means of existence, but as a struggle against all natural conditions unfavourable to the species. The animal species, in which individual struggle has been reduced to its narrowest limits, and the practice of mutual aid has attained the greatest development, are invariably the most numerous, the most prosperous, and the most open to further progress. The mutual protection which is obtained in this case, the possibility of attaining old age and of accumulating experience, the higher intellectual development, and the further growth of sociable habits, secure the maintenance of the species, its extension, and its further progressive evolution. The unsociable species, on the contrary, are doomed to decay.

– Peter Kropotkin, Mutual Aid: A Factor of Evolution (1902), Conclusion.

Kropotkin's authority as a writer on Russia is generally acknowledged, and he contributed to many articles. Most of the other 90 articles are about various aspects of Russian geography.

Kropotkin returned to Russia after the February Revolution and was offered the ministry of education in the provisional government; he rejected the post. His enthusiasm for the changes happening in the Russian Empire turned to disappointment when the Bolsheviks seized power in the October Revolution. "This buries the revolution," he said. He thought that the Bolsheviks had shown how the revolution was not to be made; by authoritarian rather than libertarian methods. He had spoken out against authoritarian socialism in his writings (for example The Conquest of Bread), making the prediction that any state founded on these principles would most likely lead to its breakup and the restoration of capitalism. This prediction preceded the Revolutions of 1989 by nearly 100 years.

He died on February 8, 1921, in the city of Dmitrov, Moscow province, and was buried at the Novodevichy Cemetery, Moscow. Anarchists marched in his funeral procession carrying banners with anti-Bolshevik slogans, at Lenin's approval, since he feared new unrest otherwise. This was the last march by anarchists until 1987, when glasnost saw them hold the first open free protest against Bolshevik state Communism for over sixty years in Moscow.

Kropotkin's inspiration has reached into the 20th and 21st centuries as a vision of a new society based on the anarchist principles of anti-statism and anti-authoritarianism, the communist principles of the publicly owned means of production and his zoological theories on the mutual aid between all species and individuals. It is often positioned as a counter to the thinking of Trotsky, Lenin and Stalin which tended to imply centralised planning and control. To a large degree Kropotkin's emphasis is on local organisation, local production obviating the need for central government. Kropotkin's vision is also on agriculture and rural life, making it a contrasting perspective to the largely industrial thinking of communists and socialists.

In his book Mutual Aid: A Factor of Evolution, Kropotkin explored the widespread use of cooperation as a survival mechanism in human societies through their many stages, and animals. Written in accessible language, he used many real life examples in an attempt to show that the main factor in facilitating evolution is cooperation between individuals in free-associated societies and groups, without central control, authority or compulsion. This was in order to counteract the conception of fierce competition as the core of evolution, that provided a rationalization for the dominant political, economic and social theories of the time; and the prevalent interpretations of Darwinism.

His observations of cooperative tendencies in indigenous peoples, pre-feudal, feudal and those remaining in modern societies, allowed him to conclude that not all human societies were based on competition such as those of industrialized Europe; and that in many societies, cooperation was the norm between individuals and groups. He also concluded that in most pre-industrial and pre-authoritarian societies (where he claimed that leadership, central government and class did not exist) actively defend against the accumulation of private property, for example, by equally sharing out, amongst the community, a person's possessions when he has died; or not allowing a gift to be sold, bartered or used to create wealth.

In another of his books, The Conquest of Bread, Kropotkin proposed a system of economics based on mutual exchanges made in a system of voluntary cooperation. He believed that should a society be socially, culturally and industrially developed enough to produce all the goods and services required by it, then no obstacle, such as preferential distribution, pricing or monetary exchange will stand as an obstacle for all taking what they need from the social product. The king pin in this idea is the eventual abolishment of money or tokens to exchange for goods and services. He further developed these ideas in Fields, Factories and Workshops.

Kropotkin points out what he considers to be the fallacies of the economic systems of feudalism and capitalism, and how he believes they create poverty and scarcity while promoting privilege. He goes on to propose a more decentralised economic system based on mutual aid and voluntary cooperation, asserting that the tendencies for this kind of organisation already exist, both in evolution and in human society.

His focus on local production leads to his view that a country should strive for self-sufficiency – manufacture its own goods and grow its own food, lessening dependence on imports. To these ends he advocated irrigation and growing under glass to boost local food production ability.