In 1978, Roberts (then named Greg Smith) was sentenced to 19 years imprisonment for a series of armed robberies of building-society branches, credit unions and shops, committed with a toy pistol while addicted to heroin. In a three-month spree in 1977, armed with an imitation pistol, he netted $32,650 AUD from 24 armed robberies. Roberts had become addicted to heroin after his marriage ended, and he lost custody of his young daughter. In his efforts to finance his drug habit, Roberts became known as the "Building Society Bandit" and the "Gentleman Bandit", because he had chosen to rob only institutions with adequate insurance, he would wear a three-piece suit, and he always said "please" and "thank you" to the people he robbed. Roberts believed at the time that in this way he was lessening the brutality of his acts, but later in his life he admitted that people only gave him money because he had made them afraid.

In July 1980, Roberts escaped from Victoria’s maximum security prison in broad daylight to become one of Australia’s most wanted men. He later claimed that he had been tortured while in solitary confinement, and that this was the main reason for planning an escape. After briefly going to New Zealand, he lived in Mumbai, where he became involved with the local mafia, and lived there for 10 years. Roberts was attracted to Mumbai because of its remarkable energy, the freedom of its people and their ability to overcome poverty. During his stay in Mumbai, Roberts was thrown into Arthur Road jail and tortured there as well, by being tied up, hung upside down and beaten with sticks. He was released from the jail some time later due to bribes paid by a senior member of the Indian mafia. Roberts ended up working for the mafia, making passport replicas among others. He never sold drugs as that was against Abdel Khader Khan, the afghan mafiaboss' moral codex. He also went to the war in Afghanistan to smuggle guns and eventually fight with the mujahedin against the Soviets.

In 1990, Roberts was captured in Frankfurt after being caught smuggling heroin into the country. He was extradited to Australia and served a further six years in prison, two of which were spent in solitary confinement. According to Roberts, he escaped prison again during that time, but then he relented and smuggled himself back into jail. His intention was to serve the rest of his sentence to give himself the chance to be reunited with his family. During his second stay in Australian prison, Roberts began writing the novel Shantaram. The manuscript was destroyed by prison wardens, twice, while Roberts was writing it.

After leaving prison, Roberts was able to finally finish and publish his novel, Shantaram. The book's name comes from the name his best friend's mother gave him, which means "Man of Peace," or "Man of God's Peace." Shantaram was mistakenly believed by some to be based on real events (or roman à clef). However, Roberts himself has clarified that the story and its incidents are largely fictional.

Roberts lived in Melbourne, Germany, and France and finally returned to Mumbai or Bombay, where he set up charitable foundations to assist the city's poor with health care coverage. Roberts was reunited with his daughter. Roberts became engaged to Francoise Sturdza, who is the president of the Hope for India Foundation. Roberts also wrote the original screenplay for the movie adaptation of Shantaram.

In 2009, Roberts was named a Zeitz Foundation Ambassador for Community. Ambassadors help raise awareness and shape activities in their respective dimension.