He has been called "the Conscience and the Mother Teresa of Economics" for his work on famine, human development theory, welfare economics, the underlying mechanisms of poverty, gender inequality, and political liberalism. However, he refutes the comparison to Mother Teresa by saying that he has never tried to follow a lifestyle of dedicated self-sacrifice. In 1998, Sen won the Nobel Memorial Prize in Economic Sciences for his contributions to work on welfare economics.

Amartya Sen's books have been translated into more than thirty languages. He is a trustee of Economists for Peace and Security. In the year 2006, Time magazine listed him under "60 years of Asian Heroes" and now in 2010 as among the 100 most influential persons in the world.

Sen was born in Santiniketan, West Bengal, the university town established by the poet Rabindranath Tagore, another Indian Nobel Prize winner. His ancestral home was in Wari, Dhaka in modern-day Bangladesh. Rabindranath Tagore is said to have given Amartya Sen his name ("Amartya" meaning "immortal"). Sen hails from a distinguished family: his maternal grandfather Kshitimohan Sen, a close associate of Rabindranath Tagore, was a renowned scholar of medieval Indian literature, an authority on the philosophy of Hinduism, and also the second Vice Chancellor of Visva-Bharati University. His maternal grandfather was an uncle of the first Chief Election Commissioner of India, Sukumar Sen and his brother, Ashoke Kumar Sen, a former Law Minister of India. Sen's father Ashutosh Sen and mother Amita Sen were born at Manikganj, Dhaka. His father was a Professor of Chemistry at Dhaka University and became Chairman of the West Bengal Public Services Commission.

Sen began his high-school education at St Gregory's School in Dhaka in 1941, in modern-day Bangladesh. His family migrated to India following partition in 1947. Sen studied in India at the Visva-Bharati University school and Presidency College, Kolkata, where he earned a First Class First in his B.A. (Honours) in Economics and emerged as the most eminent student of the well known batch of 1953. Subsequently in the same year, he moved to Trinity College, Cambridge, where he also earned a First Class (Starred First) BA (Honours) in 1956. At Cambridge he was elected as the President of the Cambridge Majlis in 1956. While still an undergraduate student of Trinity College, he met Prasanta Chandra Mahalanobis. Mahalanobis, after returning to Calcutta, recommended Sen to Triguna Sen, the then Education Minister of West Bengal. After Sen had enrolled for a Ph.D. in Economics to be completed at Trinity College, Cambridge, he arrived in India on a two year leave. Triguna Sen immediately appointed him as Professor and the Founder-Head of Department of Economics at Jadavpur University, Calcutta, which was his very first appointment, at the age of 23. During his tenure at Jadavpur University, he had the good fortune of having economic methodologist, A. K. Dasgupta, who was then teaching in Benares, as his supervisor. Sen returned to Cambridge after two years of full time teaching to complete his Ph.D. in 1959.

Subsequently, Sen won a Prize Fellowship at Trinity College, which gave him four years of freedom to do anything he liked, during which he took the radical decision of studying philosophy. That proved to be of immense help to his later research. Sen related the importance of studying philosophy thus: “The broadening of my studies into philosophy was important for me not just because some of my main areas of interest in economics relate quite closely to philosophical disciplines (for example, social choice theory makes intense use of mathematical logic and also draws on moral philosophy, and so does the study of inequality and deprivation), but also because I found philosophical studies very rewarding on their own.”

To Sen, then Cambridge was like a battlefield. There were major debates between supporters of Keynesian economics and the diverse contributions of Keynes’ followers, on the one hand, and the “neo-classical” economists skeptical of Keynes, on the other. Sen was lucky to have close relations with economists on both sides of the divide. Meanwhile, thanks to its good “practice” of democratic and tolerant social choice, Sen’s own college, Trinity College, was an oasis very much removed from the discord. However, because of a lack of enthusiasm for social choice theory whether in Trinity or Cambridge, Sen had to choose a quite different subject for his Ph.D. thesis, after completing his B.A. He submitted his thesis on “the choice of techniques” in 1959 under the supervision of the brilliant but vigorously intolerant Joan Robinson. During his time at Cambridge, and according to Quentin Skinner, Sen was a member of the secret society "The Apostles".

Between 1960–1961, he taught at Massachusetts Institute of Technology as a Visiting Professor.. He has also been a Visiting Professor at Stanford, Berkeley, and Cornell.

He has taught economics also at the University of Calcutta and at the Delhi School of Economics (where he completed his magnum opus Collective Choice and Social Welfare in 1970), where he was a Professor from 1961 to 1972, a period which is considered to be a Golden Period in the history of DSE. In 1972 he joined the London School of Economics as a Professor of Economics where he taught until 1977. From 1977 to 1986 he taught at the University of Oxford, where he was first a Professor of Economics at Nuffield College, Oxford and then the Drummond Professor of Political Economy and a Fellow of All Souls College, Oxford. In 1986 he joined Harvard as the Thomas W. Lamont University Professor of Economics. In 1998 he was appointed as Master of Trinity College, Cambridge. In January 2004 Sen returned to Harvard. He is also a contributor to the Eva Colorni Trust at the former London Guildhall University.

In May 2007, he was appointed as chairman of Nalanda Mentor Group to steer the execution of Nalanda University Project, which seeks to revive the ancient seat of learning at Nalanda, Bihar, India into an international university.

Sen's papers in the late 1960s and early 1970s helped develop the theory of social choice, which first came to prominence in the work by the American economist Kenneth Arrow, who, while working at the RAND Corporation, famously proved that all voting rules, be they majority rule or two thirds-majority or status quo, must inevitably conflict with some basic democratic norm. Sen's contribution to the literature was to show under what conditions Arrow's impossibility theorem would indeed come to pass as well as to extend and enrich the theory of social choice, informed by his interests in history of economic thought and philosophy.