Born in Mumbai, India, Rohinton Mistry immigrated to Canada in 1975, after obtaining an undergraduate degree in mathematics and economics from St. Xavier's College, Mumbai, in 1973. He worked in a bank for a while, before returning to studies, leading up to a degree in English and philosophy. While attending the University of Toronto he won two Hart House literary prizes (the first to win two), for stories which were published in the Hart House Review, and Canadian Fiction Magazine's annual Contributor's Prize for 1985. Two years later, Penguin Books Canada published his collection of 11 short stories, Tales from Firozsha Baag. It was later published in the United States as Swimming Lessons and Other Stories from Firozsha Baag. The book consists of 11 short stories, all set within one apartment complex in modern-day Mumbai. This volume contains the oft-anthologized story, "Swimming Lessons."

When his second novel, Such a Long Journey, was published in 1991, it won the Governor General's Award, the Commonwealth Writers Prize for Best Book, and the W.H. Smith/Books in Canada First Novel Award. It was shortlisted for the prestigious Booker Prize and for the Trillium Award. It has been translated into German, Swedish, Norwegian, Danish and Japanese, and has been made into the 1998 film Such a Long Journey.

His third novel, A Fine Balance (1995), won the second annual Giller Prize in 1995, and in 1996, the Los Angeles Times Book Prize for Fiction. It was selected for Oprah's Book Club in November 2001 and sold hundreds of thousands of additional copies throughout North America as a result. It won the 1996 Commonwealth Writers Prize and was shortlisted for the 1996 Booker prize.

In 2002, Mistry cancelled his United States book tour for his novel Family Matters (2002) because he and his wife were targeted by security agents at every airport he visited, apparently because Mistry appeared to be Muslim. Mistry reported that on his first flight of the tour, "we were greeted by a ticket agent who cheerfully told us we had been selected randomly for a special security check. Then it began to happen at every single stop, at every single airport. The random process took on a 100 percent certitude." His publisher issued a statement that said, "As a person of color [Mistry] was stopped repeatedly and rudely at each airport along the way—to the point where the humiliation ... had become unbearable."

His books, thus far, portray diverse facets of Indian socioeconomic life; as well as Parsi Zoroastrian life, customs, and religion. Many of his writings are markedly "Indo-nostalgic"

His literary papers are housed at the Clara Thomas Archives at York University.

• 1983 First Prize, Hart House Literary Contest: "One Sunday" (short story) (Hart House Review)
• 1984 First Prize, Hart House Literary Contest: "Auspicious Occasion" (short story) (Hart House Review)
• 1985 Annual Contributors' Prize, Canadian Fiction Magazine
• 1991 Booker Prize for Fiction (shortlist): Such a Long Journey
• 1991 Governor General's Literary Award for Fiction: Such a Long Journey
• 1992 Commonwealth Writers Prize (Overall Winner, Best Book): Such a Long Journey
• 1992 Books in Canada First Novel Award: Such a Long Journey
• 1995 Giller Prize: A Fine Balance
• 1996 Booker Prize for Fiction (shortlist): A Fine Balance
• 1996 Commonwealth Writers Prize (Overall Winner, Best Book): A Fine Balance
• 1997 Irish Times International Fiction Prize (shortlist): A Fine Balance
• 2002 James Tait Black Memorial Prize (for fiction) (shortlist): Family Matters
• 2002 Kiriyama Pacific Rim Book Prize (joint winner with Pascal Khoo Thwe): Family Matters
• 2002 Booker Prize for Fiction (shortlist): Family Matters

• A Fine Balance was one of the selected books in the 2002 edition of Canada Reads, where it was championed by actor Megan Follows.