Edward Bellamy was born in Chicopee Falls, Massachusetts. His father was Rufus King Bellamy (1816 – 1886), a Baptist minister and a descendant of Joseph Bellamy. His mother was Maria Louisa (Putnam) Bellamy, a Calvinist. Her father, Benjamin Putnam, had also been a Baptist minister, but had to withdraw from the ministry in Salem, Massachusetts, following objections to him becoming a Freemason. Edward had two older brothers, Frederick and Charles. He was the cousin of Francis Bellamy, most famous for creating the Pledge of Allegiance.

Bellamy studied at Union College and in Germany. While at Union College, he joined the Theta Chi Chapter of the Delta Kappa Epsilon fraternity; he did not graduate. He studied law, and was admitted to the bar in 1871, but left the practice to engage in newspaper work, first as an associate editor of the Springfield, Massachusetts, Union, and then as an editorial writer for the New York Evening Post. He left journalism and devoted himself to literature, writing both short stories and novels. He married Emma Augusta Sanderson in 1882. The couple had two children, Paul (b. 1884) and Marion (b. 1886).

According to Erich Fromm, Bellamy's novel Looking Backward is "one of the most remarkable books ever published in America." It was the third largest bestseller of its time, after Uncle Tom's Cabin and Ben - Hur: A Tale of the Christ. In the book, Julian West, an upper class man from 1887, awakes in 2000 from a hypnotic trance to find himself in a socialist utopia. The book influenced a large number of intellectuals, and appears by title in many of the major Marxist writings of the day. "It is one of the few books ever published that created almost immediately on its appearance a political mass movement." "Bellamy Clubs" sprang up all over the United States for discussing and propagating the book's ideas. This political movement came to be known as Nationalism. His novel also inspired several utopian communities. Although Looking Backward is unique, Bellamy owes many aspects of his philosophy to a previous reformer and author, Laurence Gronlund, who published his treatise "The Cooperative Commonwealth: An Exposition of Modern Socialism" in 1884.

Bellamy's second utopian novel, Equality, published in 1897, continues the story of Julian West as he adjusts to life in the future. Although Equality was less successful commercially or culturally than its prequel, a short story "The Parable of the Water - Tank" from Equality, was popular with a number of early American socialists, reprinted in various editions as a propaganda pamphlet.

Several hundred additional utopian novels were published in the US from 1889 to 1900, due in part to the popularity of Looking Backward.

Bellamy died from tuberculosis at his childhood home in Chicopee Falls.