Peacock was born in Weymouth, Dorset, the son of Samuel Peacock and his wife Sarah Love, daughter of Thomas Love a retired master of a man-of-war in the Royal Navy. His father was a glass merchant in London, partner of a Mr Pellatt, presumed to be Apsley Pellatt . Peacock went with his mother to live with her family at Chertsey in 1791 and in 1792 went to a school run by Joseph Harris Wicks at Englefield Green where he stayed for six and a half years. His father died in 1794 in "poor circumstances" leaving a small annuity. His first known poem was an epitaph for a school fellow written at the age of ten and another on his Midsummer Holidays was written when he was thirteen. Around that time in 1798 he was abruptly taken from school and from then on was entirely self educated.

In February 1800, Peacock became a clerk with Ludlow Fraser Company, who were merchants in the City of London. He lived with his mother on the firms premises at 4 Angel Court Throgmorton Street. He won the eleventh prize from the Monthly Preceptor for a verse answer to the question "Is History or Biography the More Improving Study?". He also contributed to "The Juvenile Library", a magazine for youth whose competitions excited the emulation of several other boys including Leigh Hunt, de Quincey, and W. J. Fox. He began visiting the Reading Room of the British Museum, which he frequented for many years, a diligent student of all the best literature in Greek, Latin, French, and Italian. In 1804 and 1806 he published two volumes of poetry, The Monks of St. Mark and Palmyra.Some of Peacock's juvenile compositions were privately printed by Sir Henry Cole.

In around 1806 he left his job in the city and during the year made a solitary walking tour of Scotland. The annuity left by his father expired in October 1806. In 1807 he returned to live at his mother's house at Chertsey. He was briefly engaged to Fanny Faulkner, but it was broken off through the interference of her relations. His friends, as he hints, thought it wrong that so clever a man should be earning so little money. In the autumn of 1808 he became private secretary to Sir Home Popham, commanding the fleet before Flushing. By the end of the year he was serving Captain Andrew King aboard in the Downs. His preconceived affection for the sea did not reconcile him to nautical realities. "Writing poetry", he says, "or doing anything else that is rational, in this floating inferno, is next to a moral impossibility. I would give the world to be at home and devote the winter to the composition of a comedy". He did write prologues and addresses for dramatic performances on board the HMS Venerable his dramatic taste then and for nine years subsequently found expression in attempts at comedies and pieces of a still lighter class, all of which fail from lack of ease of dialogue and the over-elaboration of incident and humour. He left the Venerable in March 1809 at Deal and walked around Ramsgate in Kent before returning home to Chertsey. He had sent his publisher Edward Hookham a little poem of the Thames which he expanded during the year into "The Genius of the Thames". On 29 May he set out on a two week expedition to trace the course of the River Thames from its source to Chertsey and spent two or three days staying in Oxford.

Peacock travelled to North Wales in January 1810 where he visited Tremadog and settled at Maentwrog in Merionethshire. At Maentwrog he was attracted to the parson's daughter Jane Gryffydh whom he referred to as the "Caernavonshire nymph". Early in June 1810, the "Genius of the Thames" was published by Thomas and Edward Hookham. Early in 1811 he left Maentwrog to walk home via South Wales. He climbed Cadair Idris and visited Edward Scott at Bodtalog near Towyn. His journey included Aberystwyth and Devil's Bridge, Ceredigion. Later in 1811, his mother's annuity expired and she had to leave Chertsey and moved to Morven Cottage Wraysbury near Staines with the help of some friends. In 1812 they had to leave Morven Cottage over problems paying tradesmen's bills.

In 1812 Peacock published another elaborate poem, "The Philosophy of Melancholy", and in the same year made the acquaintance of Shelley: he says in his memoir of Shelley, that he "saw Shelley for the first time just before he went to Tanyrallt", whither Shelley proceeded from London in November 1812 (Hogg's Life of Shelley, vol. 2, pp. 174, 175.) Thomas Hookham, the publisher of all Peacock's early writings, was possibly responsible for the introduction. It was Hookham's circulating library which Shelley used for many years, and Hookham had sent The Genius of the Thames to Shelley, and in the Shelley Memorials, pp. 38—40, is a letter from the poet dated 18 August 1812, extolling the poetical merits of the performance and with equal exaggeration censuring what he thought the author's patriotism misguided. Personal acquaintance almost necessarily ensued, and hence arose an intimacy not devoid of influence upon Shelley's fortunes both before and after his death.

For some years, the course of Peacock's life is only known in connection with Shelley. In the winter of 1813 he accompanies Shelley and his first wife Harriet to Edinburgh. Peacock was fond of Harriet, and in his old age defended her reputation from slanders spread by Jane, Lady Shelley, the daughter-in-law of Shelley's second wife Mary .

After Shelley deserted Harriet, Peacock throughout the winter of 1814—15 became an almost daily visitor of Shelley and his mistress, Mary Godwin (later Mary Shelley), at their London lodgings. In 1815 he shares their voyage to the source of the Thames. "He seems", writes Charles Clairmont, Mary Godwin's step-brother and a member of the party, "an idly-inclined man; indeed, he is professedly so in the summer; he owns he cannot apply himself to study, and thinks it more beneficial to him as a human being entirely to devote himself to the beauties of the season while they last; he was only happy while out from morning till night". During the winter of 1815—16 Peacock was continually walking over from Marlow, where he had established himself some time in this year, to visit Shelley at Bishopgate. There he met Hogg, and "the winter was a mere Atticism. Our studies were exclusively Greek". The benefit which Shelley derived from such a course of study cannot be overrated. Its influence is seen more and more in everything he wrote to the end of his life. The morbid, the fantastic, the polemical, gradually faded out of his mind; and the writer who begun as the imitator of the wildest extravagances of German romance would, had not his genius transcended the limits of any school, have ended as scarcely less of a Hellene than Keats and Landor.

In 1815 Headlong Hall was written, and it was published the following year. With this book Peacock definitively takes the place in literature which he was to maintain throughout his life, without substantial alteration or development beyond the mellowing which wider experience and increasing prosperity would naturally bring.

In 1816 Shelley went abroad, and Peacock appears to have been entrusted with the task of finding the Shelleys a new residence. He fixed them near his own home at Great Marlow. Melincourt was published at this time; and Nightmare Abbey and "Rhododaphne" written. Before these works were published in 1818, Shelley was again on the wing, and Peacock and he were never to meet again.

On 13 January 1819, he writes from 5 York Street, Covent Garden: "I now pass every morning at the India House, from half-past 10 to half-past 4, studying Indian affairs. My object is not yet attained, though I have little doubt but that it will be. It was not in the first instance of my own seeking, but was proposed to me. It will lead to a very sufficing provision for me in two or three years. It is not in the common routine of office, but is an employment of a very interesting and intellectual kind, connected with finance and legislation, in which it is possible to be of great service, not only to the Company, but to the millions under their dominion."

It would appear that the East India Company had become aware that their home staff was too merely clerical, and had determined to reinforce it by the appointment of four men of exceptional ability to the Examiner's office, including Peacock and James Mill.

Mill's salary is said to have been £800 a year; we do not know whether Peacock received as much. The latter's appointment is said by Sir Henry Cole to have been owing to the influence of Peter Auber, the Company's secretary and historian, whom he had known at school, though probably not as a school-fellow. Mill appears to have undergone no probation: Peacock did, but the test papers which he drafted were returned to him with the high commendation, "Nothing superfluous, and nothing wanting".

We learn from Hogg that it was on 1 July 1819 that Peacock slept for the first time in "a house in Stamford Street (No 18) which, as you might expect from a Republican, he has furnished very handsomely."

In 1820, Peacock married Jane Griffith or Gryffydh. In his "Letter to Maria Gisborne", Shelley referred to Jane as "the milk-white Snowdonian Antelope." Peacock and his wife had three daughters. One of them, Mary Ellen, married the novelist George Meredith as her second husband in August 1849. Jane Peacock died in 1865.

In 1822 Maid Marian, begun in 1818, was completed and published. It was soon dramatised with great success by Planché, and enjoyed the honour of translation into French and German. Peacock's salary was now £1000 a year, and in 1823 he acquired the residence at Lower Halliford which continued his predilection to the end of his life. In 1829 came The Misfortunes of Elphin, and in 1831 Crotchet Castle, the most mature and thoroughly characteristic of all his works.

In 1836 his official career was crowned by his appointment as Chief Examiner of Indian Correspondence, in succession to James Mill. The post was one which could only be filled by someone of sound business capacity and exceptional ability in drafting official documents: and Peacock's discharge of its duties, it is believed, suffered nothing by comparison either with his distinguished predecessor or his still more celebrated successor, Stuart Mill.

It is much to be regretted that so little is known of the old India House, or of its eminent occupants in their official capacity. It does not seem to have afforded an employment of predilection to any of them. Peacock has let in a little light in another direction:—

A DAY AT THE INDIA HOUSE

From ten to eleven, have breakfast for seven;

From eleven to noon, think you've come too soon;

From twelve to one, think what's to be done;

From one to two, find nothing to do;

From two to three, think it will be

A very great bore to stay till four.

Peacock's occupation seems to have principally lain with finance, commerce, and public works. The first clear glimpse we obtain of its nature is the memorandum prepared by him at the request of a Director respecting General Chesney's projected Euphrates expedition, and reprinted in the preface to the General's narrative as a tribute to its sagacity. The line of inquiry eventually resulted in the construction under his superintendence of iron steamboats designed to demonstrate his view of the feasibility of steam navigation round the Cape.

For many years after his appointment Peacock's authorship was in abeyance with the exception of the operatic criticisms which he regularly contributed to the "Examiner", and an occasional article in the Westminster Review or Bentley's Miscellany.

In 1837, Headlong Hall, Nightmare Abbey, Maid Marian, and Crotchet Castle appeared together as vol. 57 of Bentley's Standard Novels. About 1852, taste or leisure for authorship returned, and he commenced a series of contributions to Fraser's Magazine with the first, and most interesting, paper of his "Horae Dramaticae", a delightful restoration of the "Querolus", a Roman comedy probably of the time of Diocletian.

Peacock had in the interim retired from the India House on an ample pension (29 March 1856). Throughout 1860 his last novel, Gryll Grange, continued to appear in Fraser's Magazine.

Peacock died at Lower Halliford, 23 January 1866, from injuries sustained in a fire in which he had attempted to save his library, and is buried in the new cemetery at Shepperton. His granddaughter remembered him in these words:

Peacock's own place in literature is pre-eminently that of a satirist. That he has nevertheless been the favourite only of the few is owing partly to the highly intellectual quality of his work, but mainly to his lack of ordinary qualifications of the novelist, all pretension to which he entirely disclaims. He has no plot, little human interest, and no consistent delineation of character. His personages are mere puppets, or, at best, incarnations of abstract qualities such as grace or beauty, but beautifully depicted.

His comedy combines the mock-Gothic with the Aristophanic. He suffers from that dramatist's faults and, though not as daring in invention or as free in the use of sexual humour, shares many of his strengths. His greatest intellectual love is for Ancient Greece, including late and minor works such as the Dionysiaca of Nonnus; many of his characters are given punning names taken from Greek to indicate their personality or philosophy.

He tended to dramatize where traditional novelists narrated; he is more concerned with the interplay of ideas and opinions than of feelings and emotions; his dramatis personae is more likely to consist of a cast of more or less equal characters than of one outstanding hero or heroine and a host of minor auxiliaries; his novels have a tendency to approximate the Classical unities, with few changes of scene and few if any subplots; his novels are novels of conversation rather than novels of action; in fact, Peacock is so much more interested in what his character say to one another than in what they do to one another that he often sets out entire chapters of his novels in dialogue form. Plato's Symposium is the literary ancestor of these works, by way of the Deipnosophists of Athenaeus, in which (as in much of Peacock) the conversation relates less to exalted philosophical themes than to the points of a good fish dinner.

Novels

• Headlong Hall (published 1815 but dated 1816) [lightly revised, 1837]
• Melincourt (1817)
• Nightmare Abbey (1818) [lightly revised, 1837]
• Maid Marian (1822)
• The Misfortunes of Elphin (1829)
• Crotchet Castle (1831) [lightly revised, 1837]
• Gryll Grange (1861) [serialised first in 1860]

Verse

• The Monks of St. Mark (1804?)
• Palmyra and other Poems (1805)
• The Genius of the Thames: a Lyrical Poem (1810)
• The Genius of the Thames Palmyra and other Poems (1812)
• The Philosophy of Melancholy (1812)
• Sir Hornbook, or Childe Launcelot's Expedition (1813)
• Sir Proteus: a Satirical Ballad (1814)
• The Round Table, or King Arthur's Feast (1817)
• Rhododaphne: or the Thessalian Spirit (1818)
• Paper Money Lyrics (1837)
• The War-Song of Dinas Vawr

Essays

• The Four Ages of Poetry (1820)
• Recollections of Childhood: The Abbey House (1837)
• Memoirs of Shelley (1858—62)
• The Last Day of Windsor Forest (1887) [composed 1862]
• Prospectus: Classical Education

Plays

• The Three Doctors
• The Dilettanti
• Gl'Ingannati, or The Deceived (translated from the Italian, 1862)

Unfinished tales and novels

• Satyrane (c. 1816)
• Calidore (c. 1816)
• The Pilgrim of Provence (c. 1826)
• The Lord of the Hills (c. 1835)
• Julia Procula (c. 1850)
• A Story Opening at Chertsey (c. 1850)
• A Story of a Mansion among the Chiltern Hills (c. 1859)
• Boozabowt Abbey (c. 1859)
• Cotswald Chace (c. 1860)