Ossietzky was born in Hamburg, the son of Carl Ignatius von Ossietzky (1848 – 1891), a Protestant from Upper Silesia, and Rosalie née Pratzka, a devout Catholic who wished for Carl to become a monk. His father worked as a stenographer in the office of a lawyer and senator, but died when Carl was two years old. Carl was baptized in the Catholic Church Kleine Michel in Hamburg on 10 November 1889, and confirmed in the Lutheran Hauptkirche St. Michaelis on 23 March 1904.

The "von" in Ossietzky's name, which would generally suggest noble ancestry, is of unknown origin. Ossietzky himself explained, perhaps half in jest, that it derived from an ancestor's service in a Polish lancer cavalry regiment; the Elector of Brandenburg was unable to pay his two regiments of lancers at one point due to an empty war chest so he instead conferred nobility upon the entirety of the two regiments.

Despite his failure to finish the Realschule, a German secondary school, Ossietzky succeeded in embarking on a career in journalism, with the topics of his articles ranging from theatre criticism to feminism and the problems of early motorization. He later said that his opposition to German militarism during the final years of the German Empire under William II led him, as early as 1913, to become a pacifist. That year he married Maud Lichfield - Wood, a Mancunian suffragette, born as a British colonial officer's daughter and great grand - daughter of an Indian princess in Hyderabad. They had one daughter, Rosalinde. During the years of the Weimar Republic (1919 – 1933), his political commentaries gained him a reputation as a fervent supporter of democracy and a pluralistic society. ". In 1921, the German government founded the so-called Arbeits - Kommandos (Work Commandos) led by Major Bruno Ernst Buchrucker, which was officially a labour group intended to assist with civilian projects, but in reality the group was used by Germany to exceed the limits on troop strength set by the Treaty of Versailles. Buchrucker's Black Reichswehr took its orders from a secret group in the German Army known as Sondergruppe R comprising Kurt von Schleicher, Eugen Ott, Fedor von Bock and Kurt von Hammerstein - Equord. Buchrucker's so-called "Black Reichswehr" became infamous for its practice of murdering Germans suspected of working as informers for the Allied Control Commission. The killings perpetrated by the Black Reichswehr were justifed under the so-called Femegerichte (secret court) system. These killings were ordered by the officers from Sondergruppe R. Regarding the Femegerichte murders, Ossietzky wrote:

"Lieutenant Schulz (charged with the murder of informers against the Black Reichswehr) did nothing but carry out the orders given him, and that certainly Colonel von Bock, and probably Colonel von Schleicher and General Seeckt, should be sitting in the dock beside him".

Also, he became secretary of the German Peace Society (Deutsche Friedensgesellschaft). In 1927 he became the successor to Kurt Tucholsky as editor - in - chief of the periodical Die Weltbühne. In 1932 he supported Ernst Thälmann's candidacy for the German presidency, though still a critic of the actual policy of the German Communist Party and the Soviet Union.

In 1929 Walter Kreiser, one of the writers for Die Weltbühne, published an expose of the training of a special air unit of the Reichswehr, referred to as Abteilung M ("M Battalion"), which was secretly training in Germany and in Soviet Russia, in violation of Germany's agreements under the Treaty of Versailles. Kreiser and Ossietzky, the paper's editor, were questioned by a magistrate of the Supreme Court about the article later that year, and were finally indicted in early 1931 for "treason and espionage," the assertion being that they had drawn international attention to state affairs which the state had purposefully attempted to keep secret. The arrests were widely seen at the time as an effort to silence Die Weltbühne which had been a vocal critic of the Reichswehr's policies and secret expansion.

Counsel for the defendants pointed out that the information they had published was true, and, more to the point, that the budgeting for Abteilung M had actually been cited in reports by the Reichstag's budgeting commission. The prosecution successfully countered that Kreiser (and Ossietzky, as his editor) should have known that the reorganization was a state secret when he questioned the Ministry of Defense on the subject of Abteilung M and the ministry refused to comment on it. Kreiser and Ossietzky were convicted and sentenced to eighteen months in prison. Kreiser fled Germany but Ossietzky remained and was imprisoned, being released at the end of 1932 for the Christmas amnesty.

Ossietzky continued to be a constant warning voice against militarism and Nazism when, in January 1933, Adolf Hitler was appointed Chancellor and the Nazi dictatorship began. Even then, Ossietzky was one of a very small group of public figures who continued to speak out against the Nazi Party. On 28 February 1933, after the Reichstag fire, he was arrested and held in so-called protective custody in Spandau prison. Wilhelm von Sternburg, one of Ossietzky's biographers, surmises that if Ossietzky had had a few more days, he would surely have joined the vast majority of writers who fled the country. In short, Ossietzky underestimated the speed with which the Nazis would go about ridding the country of unwanted political opponents. He was detained afterwards at the concentration camp KZ Esterwegen near Oldenburg, among other camps.

Ossietzky's international rise to fame began in 1936 when, already suffering from serious tuberculosis that was not being treated, he was awarded the 1935 Nobel Peace Prize. The government had been unable to prevent this, but they now refused to release him so that he could travel to Oslo to receive the prize. In an act of civil disobedience, after Hermann Göring prompted him to decline the prize, Ossietzky issued a note from the hospital saying that he disagreed with the authorities who had stated that by accepting the prize he would cast himself outside the deutsche Volksgemeinschaft (community of German people):

After much consideration, I have made the decision to accept the Nobel Peace Prize which has fallen to me. I cannot share the view put forward to me by the representatives of the Secret State Police that in doing so I exclude myself from German society. The Nobel Peace Prize is not a sign of an internal political struggle, but of understanding between peoples. As a recipient of the prize, I will do my best to encourage this understanding and as a German I will always bear in mind Germany's justifiable interests in Europe.

The award was extremely controversial, prompting two members of the prize committee to resign because they held or had held positions in the Norwegian government. King Haakon VII of Norway, who had been present at other award ceremonies, stayed away from the ceremony. The award divided public opinion, and was generally condemned by conservative forces. The leading conservative Norwegian newspaper Aftenposten argued in an editorial that Ossietzky was a criminal who had attacked his country "with the use of methods that violated the law long before Hitler came into power" and that "lasting peace between peoples and nations can only be achieved by respecting the existing laws".

Ossietzky's Nobel Prize was not allowed to be mentioned in the German press, and a government decree forbade German citizens from accepting future Nobel Prizes.

In May 1936 he was sent to the Westend hospital in Berlin - Charlottenburg because of his tuberculosis, but under Gestapo surveillance. He died in the Nordend hospital in Berlin - Pankow, still in police custody, on 4 May 1938, of tuberculosis and from the after - effects of the abuse he suffered in the concentration camps.

In 1991, the University of Oldenburg was renamed Carl von Ossietzky Universität Oldenburg in his honor. This could be seen as a political statement, as Ossietzky's case was being decided upon by the German courts at the time.

In 1992, Ossietzky's 1931 conviction was upheld by Germany's Federal Court of Justice, applying the law as it stood in 1931 (this does not mean that the court accepted or retroactively legalized the later Nazi persecution of Ossietzky, which was clearly illegal even under Nazi Germany's law):

According to the case law of the Supreme Court of the German Reich, the illegality of covertly conducted actions did not cancel out the principle of secrecy. According to the opinion of the Supreme Court of the German Reich, every citizen owes his Fatherland a duty of allegiance regarding information, and endeavours towards the enforcement of existing laws may be implemented only through the utilization of responsible domestic state organs, and never by appealing to foreign governments. – Ruling of the Federal Court of Justice, 3 December 1992

Supporters of convicted Israeli whistleblower Mordechai Vanunu and Nobel prize winning Chinese dissident Liu Xiaobo have compared them to Ossietzky.

The International League for Human Rights (ILMR) awards an annual Carl von Ossietzky Medal "to honor citizens or initiatives that promote basic human rights."

On 1963, the East German television produced the film Carl von Ossietzky about Ossietzky's life, starring Hans - Peter Minetti in the title role.

Carl von Ossietzky is portrayed in the comic series Berlin by Jason Lutes.