Bukharin was born in Moscow to two primary school teachers (his childhood is vividly recounted in his mostly autobiographic novel How It All Began, written shortly before his execution). His political life began at the age of sixteen with his lifelong friend Ilya Ehrenburg when he participated in student activities at Moscow University related to the Russian Revolution of 1905. He joined the Russian Social Democratic Labour Party in 1906, becoming a member of the Bolshevik faction. With Grigori Sokolnikov, he convened the 1907 national youth conference in Moscow, which was later considered the founding of the Komsomol.

By age 20, he was a member of the Moscow Committee of the party. The committee was heavily infiltrated by the tsarist secret police, or Okhrana. As one of its leaders, Bukharin quickly became a person of interest to them. During this time, he became closely associated with N. Osinskii and Vladimir Smirnov and met his future wife, Nadezhda Mikhailovna Lukina, the sister of Nikolai Lukin. They married soon after his exile.

In 1911, after a brief imprisonment, Bukharin was exiled to Onega in Arkhangelsk, but soon escaped to Hanover, where he stayed for a year before visiting Cracow in 1912 to meet Vladimir Lenin for the first time. During the exile, he continued his education and wrote several books that established him as a major Bolshevik theorist in his 20's. His work, "Imperialism and World Economy" during World War I influenced Lenin, who freely borrowed from it in his larger and better known work, Imperialism — The Highest Stage of Capitalism. Nevertheless, he and Lenin often had hot disputes on theoretical issues and Bukharin's closeness with the European Left and his anti-statist tendencies. He developed an interest in the works of Austrian Marxists and non-Marxist economic theorists, such as Aleksandr Bogdanov, who deviated from Leninist positions. Also while in Vienna in 1913, he helped the Georgian Bolshevik Joseph Stalin write an article "Marxism and the National Question" at Lenin's request.

In October 1916, while based in New York City, he edited the newspaper Novy Mir (New World) with Leon Trotsky and Alexandra Kollontai. When Trotsky arrived in New York in January 1917, Bukharin was the first to greet him (as Trotsky's wife recalled, "with a bear hug and immediately began to tell them about a public library which stayed open late at night and which he proposed to show us at once" dragging the tired Trotskys across town "to admire his great discovery").

At the news of Russian Revolution of February 1917, Bukharin returned to Russia by way of Japan and at once became one of the leading Bolsheviks in Moscow, being elected to the Central Committee. During the October Revolution, he drafted, introduced, and defended the revolutionary decrees of the Moscow Soviet, in whose name the insurrection took place. Bukharin then represented the Moscow party in their report to the revolutionary government in Petrograd. After the second 1917 revolution, he became the editor of the party's newspaper, Pravda.

In 1918, he emerged as the leader of the Left Communists in bitter opposition to Trotsky's signing of the Treaty of Brest-Litovsk with Germany, which was viewed as a betrayal of the German proletariat. By contrast Bukharin advocated guerrilla warfare against the German army within Russia, a resistance he believed would inspire a worldwide proletarian revolution. At this time Bukharin's view was that Russia on her own was not yet ready for socialism at her politico-economic stage. He even contemplated arresting Lenin for 24 hours (this was a charge framed against him by Stalin at the time of his trial, which he denied. It is now accepted that he was falsely implicated by Stalin to disgrace him and to occupy himself the authoritative position as a Marxist thinker or Marxist theoretician. In presence of Bukharin, Stalin could not declare himself as the only authority to interpret Marxism, because in the party and outside, Bukharin was the only Bolshevik known as a Marxist theoretician. Lenin himself wrote prefaces to many books of Bukharin like the preface to "Imperialism and the World Economy".

In March 1919, he became a member of the Comintern's executive committee and a candidate member of Politburo. During the Civil War period, he published several theoretical economic works, including The Economics of the Transitional Period (1920), The ABC of Communism together with Evgenii Preobrazhensky (1921), which became popular primer explaining communism to wide audiences both inside and outside the Soviet Union, and The Theory of Historical Materialism (1921).

By 1921, he changed his position and accepted Lenin's emphasis on the survival and strengthening of the Soviet state as the bastion of the future world revolution. He became the foremost supporter of the New Economic Policy (NEP), to which he was to tie his political fortunes. Considered by the Left Communists as a retreat from socialist policies, NEP reintroduced money, allowed private ownership and capitalistic practices in agriculture, retail trade, and light industry while the state retained the control of heavy industry. While some have criticized Bukharin for this apparent U-turn, his change of emphasis can be partially explained by the necessity for peace and stability following seven years of war in Russia, and the failure of Communist Revolutions in Central and Eastern Europe, which ended the prospect of worldwide revolution.

After Lenin's death in 1924, Bukharin became a full member of the Politburo. In the subsequent power struggle among Trotsky, Zinoviev, Kamenev, and Stalin, Bukharin allied himself with Stalin, who positioned himself as centrist of the Party and supported NEP against the Left Opposition, which wanted more rapid industrialization, escalation of class struggle against the kulaks, and agitation for world revolution. It was Bukharin who formulated the thesis of "Socialism in One Country" put forth by Stalin in 1924, which argued that socialism (in Marxist theory, the transitional stage from capitalism to communism) could be developed in a single country, even one as underdeveloped as Russia. This new theory stated that revolution need no longer be encouraged in the capitalist countries since Russia could and should achieve socialism alone. The thesis would become a hallmark of Stalinism.

Trotsky, the prime force behind the Left Opposition, was defeated by a triumvirate formed by Stalin, Zinoviev and Kamenev, with the support of Bukharin. By 1926, the Stalin - Bukharin alliance ousted Zinoviev and Kamenev from the Party leadership, and Bukharin enjoyed the highest degree of power during the 1926 - 1928 period. He emerged as the leader of the Party's right wing, which included two other Politburo members Alexei Rykov, Lenin's successor as Chairman of the Council of People's Commissars, and Mikhail Tomsky, head of trade unions, and he became chairman of Comintern's executive committee in 1926. However, prompted by the grain shortage of 1928, Stalin reversed himself and proposed a program of rapid industrialization and forced collectivization because he believed that the NEP was not working fast enough. Stalin suddenly adopted the policies of his vanquished foes – Trotsky, Zinoviev, and Kamenev.

Bukharin was worried by the prospect of Stalin's plan, which he feared would lead to “military - feudal exploitation” of the peasantry. Bukharin did want the Soviet Union to achieve industrialization but he preferred the more moderate approach of offering the peasants the opportunity to become prosperous, which would lead to greater grain production for sale abroad. Bukharin pressed his views throughout 1928 in meetings of the Politburo and at the Party Congress, insisting that enforced grain requisition would be counter-productive, as War Communism had been a decade earlier.

Bukharin's support of continuation of NEP was not popular with higher Party cadres, and his slogan to peasants, “Enrich yourselves!” and proposal to achieve socialism “at snail's pace” left him vulnerable to attacks first by Zinoviev and now by Stalin. Stalin attacked Bukharin's views, portraying them as capitalist deviation and declaring that the revolution would be at risk without a strong policy that encouraged rapid industrialization.

Having helped Stalin achieve unchecked power against the Left Opposition, Bukharin found himself easily outmaneuvered by Stalin. Nevertheless, Stalin's victory would not have been inevitable if Bukharin had been more politically astute. He seems to have enjoyed a majority in the Politburo initially (he said Kalinin and Voroshilov betrayed the Right at the last minute) and unlike the Left Opposition, broad mass support among the peasantry, which made up 80% of the Russian population. Yet Bukharin played to Stalin's strength by maintaining the appearance of unity within the Party leadership. Meanwhile, Stalin used his control of the Party machine to replace Bukharin's supporters in the Rightist power base in Moscow, trade unions, and Comintern.

Bukharin attempted to gain support from earlier foes including Kamenev and Zinoviev who had fallen from power and held mid level positions within the Communist party. The details of his meeting with Kamenev, to whom he confided that Stalin was a “Genghis Khan” who changed policies to get rid of rivals, were leaked by the Trotskyist press and subjected him to accusation of factionalism. Eventually, Bukharin lost his position in the Comintern in April 1929 and editorship of Pravda, and he was expelled from the Politburo on November 17 of that year. Bukharin was forced to renounce his views under pressure. He wrote letters to Stalin pleading for forgiveness and rehabilitation, but through wiretaps of Bukharin's private conversations with Stalin's enemies, Stalin knew Bukharin's repentance was insincere.

International supporters of Bukharin, Jay Lovestone of the Communist Party USA among them, were also expelled from the Comintern. They formed an international alliance to promote their views, calling it the International Communist Opposition, though it became better known as the Right Opposition, after a term used by the Trotskyist Left Opposition in the Soviet Union to refer to Bukharin and his supporters there.

Stalin's collectivization policy proved to be as disastrous as Bukharin predicted, but Stalin had by then achieved unchallenged authority in the Party leadership. However, there were signs that moderates among Stalin's supporters sought to end official terror and bring a general change in policy, now that mass collectivization was largely completed and the worst was over. Although Bukharin had not challenged Stalin since 1929, his former supporters, including Martemyan Ryutin, drafted and circulated clandestinely an anti-Stalin platform, which called Stalin the “evil genius of the Russian Revolution”. Stalin wanted to impose the death penalty on those involved, despite Lenin's injunction against bloodletting among Party members, but he was resisted by moderates.

More importantly, Sergey Kirov, a Leningrad party leader, was emerging as popular leader of the moderates. Although Kirov himself was a staunch Stalin loyalist, he was in favor of a general relaxation and reconciliation toward former oppositionists. In the 1934 Party congress, Kirov was elected to the Central Committee with only three negative votes, the fewest of any candidate, while Stalin received 292 negative votes. In the brief period of thaw in 1934 - 1936, Bukharin was politically rehabilitated and was made editor of Izvestia in 1934. There, he consistently highlighted the dangers of fascist regimes in Europe and the need for "proletarian humanism". He was also the principal framer of the Soviet Constitution of 1936, which promised freedom of speech, the press, assembly, religion, and the privacy of the person, his home, and his correspondence. However, Kirov was assassinated in Leningrad in December 1934, and his death was used by Stalin as a pretext to launch the Great Purge, in which about a million people were to perish as Stalin eliminated all past and potential opposition to his authority. Some historians now believe that Kirov's assassination in 1934 was arranged by Stalin himself or at least that there is sufficient evidence to plausibly posit such a conclusion. After Kirov's assassination, the NKVD charged an ever growing group of former oppositionists with Kirov's murder and other acts of treason, terrorism, sabotage, and espionage.

Shortly before the purge started in earnest, Bukharin was sent to Paris by Stalin in February 1936 to negotiate the purchase of Marx and Engels archives, held by the German Social Democratic Party (SPD) before its dissolution by Hitler. He was joined by his young wife Anna Larina, which therefore opened the possibility of exile, but he decided against it saying that he could not live outside the Soviet Union.

Bukharin, who had been forced to follow the Party line since 1929, confided to his old friends and former opponents his real view of Stalin and his policies. His conversations with Boris Nicolaevsky, a Menshevik leader who held the manuscripts on behalf of SPD, formed the basis of "Letter of an Old Bolshevik", which was very influential in the contemporary understanding of the period (especially the Ryutin Affair and Kirov murder) although there are doubts about its authenticity. According to Nicolaevsky, Bukharin spoke of "the mass annihilation of completely defenseless men, with women and children" under forced collectivization and liquidation of kulaks as a class that dehumanized the Party members with "the profound psychological change in those communists who took part in the campaign. Instead of going mad, they accepted terror as a normal administrative method and regarded obedience to all orders from above as a supreme virtue... They are no longer human beings. They have truly become the cogs in a terrible machine."

Yet to another Menshevik leader, Fyodor Dan, he confided that Stalin became "the man to whom the Party granted its confidence" and "is a sort of a symbol of the Party" even though he "is not a man, but a devil." In Dan's account, Bukharin’s acceptance of the Soviet Union’s new direction was thus a result of his utter commitment to Party solidarity. To André Malraux, he also confided, "Now he is going to kill me". To his boyhood friend, Ilya Ehrenburg, he expressed the suspicion that the whole trip was a trap set up by Stalin. Indeed, his contacts with Mensheviks during this trip were to feature prominently in his trial.

Following the trial and execution of Zinoviev, Kamenev, and other leftist Old Bolsheviks in 1936, Bukharin and Rykov were arrested following a plenum of the Central Committee in January 1937 and were charged with conspiring to overthrow the Soviet state. Bukharin was tried in the Trial of the Twenty One on March 2 – 13, 1938 during the Great Purges, along with ex-premier Alexei Rykov, Christian Rakovsky, Nikolai Krestinsky, Genrikh Yagoda, and 16 other defendants alleged to belong to the so-called "Bloc of Rightists and Trotskyites". Meant to be the culmination of previous show trials, it was now alleged that Bukharin and others sought to assassinate Lenin and Stalin from 1918, murder Maxim Gorky by poison, partition the U.S.S.R and hand out her territories to Germany, Japan, and Great Britain.

Even more than earlier Moscow show trials, Bukharin's trial horrified many previously sympathetic observers as they watched allegations become more absurd than ever and the purge expand to include almost every living Old Bolshevik leader except Stalin. For some prominent communists such as Bertram Wolfe, Jay Lovestone, Arthur Koestler, and Heinrich Brandler, the Bukharin trial marked their final break with communism and even turned the first three into fervent anti-Communists eventually.

While Anastas Mikoyan and Vyacheslav Molotov later claimed that Bukharin was never tortured and his letters from prison do not give the suggestion that he was tortured, it is also known that his interrogators were instructed with the order: "beating permitted". Bukharin held out for three months, but threats to his young wife and infant son, combined with "methods of physical influence" wore him down. But when he read his confession amended and corrected personally by Stalin, he withdrew his whole confession. The examination started all over again, with a double team of interrogators. Bukharin's confession and his motivation became the subject of much debate among Western observers, inspiring Koestler's acclaimed novel Darkness at Noon and a philosophical essay by Maurice Merleau-Ponty in Humanism and Terror. His confessions were somewhat different from others in that while he pled guilty to the "sum total of crimes", he denied knowledge when it came to specific crimes. Some astute observers noted that he would allow only what was in the written confession and refuse to go any further.

There are several interpretations of Bukharin's motivations (beside being coerced) in the trial. Koestler and others viewed it as a true believer's last service to the Party (while preserving the little amount of personal honor left) whereas Bukharin biographers Stephen Cohen and Robert Tucker saw traces of Aesopian language, with which Bukharin sought to turn the table into an anti-trial of Stalinism (while keeping his part of the bargain to save his family). While his letters to Stalin – he wrote 34 very emotional and desperate letters tearfully protesting his innocence and professing his loyalty – suggest a complete capitulation and acceptance of his role in the trial, it contrasts with his actual conduct in the trial.

Bukharin himself speaks of his "peculiar duality of mind" in his last plea, which led to "semi-paralysis of the will" and Hegelian "unhappy consciousness", which likely stemmed not only from his knowledge of the ruinous reality of Stalinism (although he could not of course say so in the trial) but also of the impending threat of fascism (which required acquiesing to Stalin, who had become the personification of the Party, the only conceivable body of resistance to fascism, and the required object of any Bolshevik's ultimate loyalty).

The result was a curious mix of fulsome confessions (of being a "degenerate fascist" working for the "restoration of capitalism") and subtle criticisms of the trial. After disproving several charges against him (one observer noted that he "proceeded to demolish or rather showed he could very easily demolish the whole case.") and saying that "the confession of accused is not essential. The confession of the accused is a medieval principle of jurisprudence" in a trial that was solely based on confessions, he finished his last plea with the words:

"the monstrousness of my crime is immeasurable especially in the new stage of struggle of the U.S.S.R. May this trial be the last severe lesson, and may the great might of the U.S.S.R become clear to all."

While in prison, he wrote at least four book-length manuscripts including a lyrical autobiographical novel, How It All Began, philosophical treatise Philosophical Arabesques, a collection of poems, and Socialism and Its Culture – all of which were found in Stalin's archive and published in the 1990s).

Romain Rolland among others wrote to Stalin seeking clemency: "An intellect of the Bukharin type is a treasure for his country. We are all to blame for the death of the chemist of genius Lavoisier, we, the bravest of revolutionaries, who cherish the memory of Robespierre - nonetheless profoundly regret and grieve. I beg you to show clemency." He had earlier written to Stalin in 1937, "For the sake of Gorky I am asking you for mercy, even if he may be guilty of something," to which Stalin noted: "It does not have to be answered." Bukharin was executed on March 15, 1938, but the announcement of his death was overshadowed by the Nazi Anschluss of Austria.

'Koba, why do you need me to die?' Bukharin wrote in a note to Stalin just before his execution. ("Koba" was Stalin's revolutionary pseudonym, and Bukharin's use of it was a sign of how close the two had once been. The note was found still in Stalin's desk after his death in 1953.).

Despite the promise to spare his family, Bukharin's wife, Anna Larina, was sent to a labor camp, but she survived to see her husband officially rehabilitated by the Soviet state under Mikhail Gorbachev in 1988.

Bukharin was immensely popular within the party throughout the twenties and thirties, even after his fall from power. In his testament, Lenin portrayed him as 'the Golden Boy' of the party and writing:

Speaking of the young C.C. members, I wish to say a few words about Bukharin and Pyatakov. They are, in my opinion, the most outstanding figures (among the youngest ones), and the following must be borne in mind about them: Bukharin is not only a most valuable and major theorist of the Party; he is also rightly considered the favourite of the whole Party, but his theoretical views can be classified as fully Marxist only with great reserve, for there is something scholastic about him (he has never made a study of the dialectics, and, I think, never fully understood it)... Both of these remarks, of course, are made only for the present, on the assumption that both these outstanding and devoted Party workers fail to find an occasion to enhance their knowledge and amend their one-sidedness.

Bukharin made several notable contributions to Marxist-Leninist thought, most notably The Economics of the Transition Period (1918) and his prison writings, Philosophical Arabesques, (which clearly reveal Bukharin had corrected the 'one-sidedness' of his thought), as well as being a founding member of the Soviet Academy of Arts and Sciences, and a keen botanist. His primary contributions to economics were his critique of marginal utility theory, his analysis of imperialism, and his writings on the transition to the communism in Soviet Union.

Voice of the stalking shadow (Pin thodarum nizhalin kural), a Tamil novel by Jeyamohan, is based on the life of Nikolai Bukharin.

Nikolai Bukharin was a gifted cartoonist who left many cartoons on contemporary Soviet politicians. The renowned artist Konstantin Yuon once told him: “Forget about politics. There is no future in politics for you. Painting is your real calling." His cartoons are sometimes used to illustrate biographies of Soviet officials. Russian historian Yury Zhukov stated that Nikolai Bukarin's portraits of Joseph Stalin were the only ones drawn from the original, not from a photograph.