Kruger was born an only child into a lower-middle-class family in Newark, New Jersey. Her Father worked as a chemical technician for Shell Oil and her mother was a legal secretary. She graduated from Weequahic High School. She attended Syracuse University, but left after one year due to the death of her Father. After spending a year at Syracuse University, in 1965, she went on to pursue a semester at Parson's school of Design in New York. Over the next ten years, Kruger established herself whilst pursuing graphic design for magazines, freelance picture editing, as well as designing book jackets. By the later 1960s, Kruger gained interest in poetry, and began attending poetry readings and writings. Kruger studied art and design with Diane Arbus and Marvin Israel at Parsons School of Design in New York. Kruger soon obtained a design job at Condé Nast Publications. There after, Kruger was awarded the head designer for that following year. She initially worked as a designer at Mademoiselle and later moved on to work part-time as a picture Editor at House and Garden, Aperture, and other publications. She also wrote film, television, and music columns for Artforum and Real Life Magazine at the suggestion of her friend Ingrid Sischy.

Kruger's earliest works date back to 1969. These works were large wall hangings made out of different materials such as yarn, beads, sequins, feathers and ribbons. These pieces represented the feminist recuperation of craft during this period. Kruger crocheted, sewed and painted bright-hued and erotically suggestive objects, some of which were included by curator Marcia Tucker in the 1973 Whitney Biennial. They were inspired by Magdalena Abakanowicz’s show at the Museum of Modern Art. Although some of these works were included in the Whitney Biennial, Kruger became detached and unsatisfied with her working output. In 1976 she took a break from making what had become more abstract works, feeling that her work had become meaningless and mindless. She then moved to Berkeley, California where she taught at the University of California and became inspired by the writings of Walter Benjamin and Roland Barthes. In 1977 she returned to artmaking, working with her own architectural photographs and publishing an artist's book, Picture/Readings, in 1979. She was inspired to photograph architecture from her family "looking at family homes [they] could never afford."

Kruger was involved with a group of artists from her graduating classes from CalArts in the 1970s, including Ross Bleckner and David Salle, listing them as her “first peer group.” She considered Diane Arbus to be her “first female role model…[that] didn’t wash the floor six times a day.” She also was connected with Julian Schnabel, Marilyn Lerner, Sherrie Levine, Cindy Sherman, Jim Welling, Nancy Dwyer, Louise Lawler, Sarah Charlesworth, Laurie Simmons, Carol Squiers, Judith Barry, Jenny Holzer, Richard Prince, Becky Johnston, and Lynee Tillman. She was also involved in a group called Artists Meeting for Cultural Change.

In 1979, Barbara Kruger exhibited her first works combining appropriated photographs and fragments of superimposed text at P.S. 1 Contemporary Art Center, in Long Island City, Queens. Her first institutional show was staged in London, when Iwona Blazwick decided to exhibit her work at the Institute of Contemporary Arts in 1983. In 1999, the Museum of Contemporary Art in Los Angeles mounted the first retrospective exhibition to provide a comprehensive overview of Kruger's career since 1978, which travelled to the Whitney Museum of American Art, New York in 2000. Kruger has since been the subject of many one-person exhibitions, including shows organized by the Institute of Contemporary Arts in London (1983); the Musée d'art contemporain de Montréal (1985); Serpentine Gallery in London (1994); Palazzo delle Papesse Centro Arte Contemporanea in Siena (2002); Museum of Contemporary Art San Diego (2005); and Moderna Museet in Stockholm (2008). In 2009, Kruger was included in the seminal show "The Pictures Generation, 1974–1984" at the Metropolitan Museum of Art. Kruger has also participated in the Whitney Biennial (1983, 1985, and 1987) and Documenta 7 and 8 (1982 and 1987). She represented the United States at the Venice Biennale in 1982 and again participated in 2005, when she received the Leone d'Oro for lifetime achievement.

Kruger's first dealer was Gagosian Gallery, with which she did two shows in Los Angeles in the early 1980s. In 1986, she was the first woman to join the prominent contemporary art gallery of Mary Boone and has had nine solo shows there since. Kruger is also represented by Rhona Hoffman Gallery, Chicago; and Sprüth Magers Berlin London and L&M Arts in Los Angeles. In late 2011, her 1985 photo of a ventriloquist's dummy, Untitled (When I Hear the Word Culture I Take Out My Checkbook), was sold at Christie's for a record $902,500.

Her poster for the 1989 Women's March on Washington in support of legal abortion included a woman's face bisected into positive and negative photographic reproductions, accompanied by the text "Your body is a battleground." A year later, Kruger used this slogan in a billboard commissioned by the Wexner Center for the Arts. Twelve hours later, a group opposed to abortion responded to Kruger's work by replacing the adjacent billboard with an image depicting an eight-week-old fetus.

In 1990, Kruger scandalized the Japanese American community of Little Tokyo, Los Angeles, with her proposal to paint the Pledge of Allegiance, bordered by provocative questions, on the side of a warehouse in the heart of the historic downtown neighborhood. Kruger had been commissioned by MOCA to paint a mural for "A Forest of Signs: Art in the Crisis of Representation," a 1989 exhibition that also included works by Barbara Bloom, Jenny Holzer, Jeff Koons, Sherrie Levine, and Richard Prince. But before the mural went up, Kruger herself and curator Ann Goldstein presented it at various community meetings over the time period of 18 months. Only after protests did the Artist offer to eliminate the pledge from her mural proposal, while still retaining a series of questions painted in the colors and format of the American flag: "Who is bought and sold? Who is beyond the law? Who is free to choose? Who follows orders? Who salutes longest? Who prays loudest? Who dies first? Who laughs last?". A full year after the exhibition closed, Kruger's reconfigured mural finally went up for a two-year run.

Supreme, a skateboard and apparel brand established in 1994, have been accused of taking their logo, the white word “Supreme” on a red box, from Kruger’s signature style. James Jebbia, founder of Supreme, has admitted that the logo was taken from Barbara Kruger’s work. Barbara herself had not commented on this issue until a recent lawsuit between Supreme and Leah McSweeney, founder of Married to the Mob (MTTM), a women’s street clothing brand. MTTM used the Supreme logo to make a “Supreme Bitch” logo that was printed on T-shirts and hats. Kruger commented “What a ridiculous clusterfuck of totally uncool jokers. I make my work about this kind of sadly foolish farce. I’m waiting for all of them to sue me for copyright infringement.” Eventually the lawsuits were dropped on agreement that McSweeney could continue to use the words “Supreme Bitch” if it was "not in the way Barbara Kruger does."

Kruger has taught at the Independent Study Program at the Whitney Museum; California Institute of the Arts, Valencia; University of California, Berkeley; Chicago; and UCSD for five years before joining the faculty at the University of California at Los Angeles. In 1995–96, she was Artist in residence at the Wexner Center for the Arts, where she created Public Service Announcements addressing issues of domestic violence. In 2000, she was the Wiegand Foundation Artist in Residence at Scripps College, Claremont. She has written about television, film and culture for Artforum, Esquire, The New York Times, and The Village Voice.

The Museum of Contemporary Art, Los Angeles awarded Kruger the MOCA Award to Distinguished Women in the Arts in 2001. In 2005, she was included in The Experience of Art at the Venice Biennale and was the recipient of the Leone d'Oro for lifetime achievement. At the 10th anniversary Gala in the Garden at the Hammer Museum in 2012, Kruger was honored by TV presenter Rachel Maddow. In 2012, Kruger joined John Baldessari and Catherine Opie in leaving the Museum of Contemporary Art's board in protest, but later returned in support of the museum's new Director, Philippe Vergne, in 2014.

In 2007, Kruger was one of the many artists to be a part of South Korea's Incheon Women Artists' Biennale in Seoul. This marked South Korea's first women's biennial. That same year, she designed "Consider This...", an exhibition at the Los Angeles County Museum of Art. In September 2009, Kruger’s Between Being Born and Dying, a major installation commissioned by the Lever House Art Collection, opened at the New York City architectural landmark Lever House. In 2012, as a member of the board of the Museum of Contemporary Art, Los Angeles (MOCA), Kruger volunteered to be the lead funder of the museum's scholarly exhibit Ends of the Earth: Land Art to 1974 and to create a new work on vinyl to sell with proceeds going entirely toward the show's $1 million budget.

Since the mid-1990s, Kruger has created large-scale immersive video and audio installations. Enveloping the viewer with the seductions of direct address, the work continues her questioning of power, control, affection and contempt: still images now move and speak and spatialize their commentary. In 1997, Kruger produced a series of fiberglass sculptures of compromised celebrities, including John F. and Robert Kennedy hoisting Marilyn Monroe on their shoulders. For a concurrent show that same year in New York, she had city buses wrapped with quotations from figures such as Malcolm X, Courtney Love, and H.L. Mencken. For her first retrospective, at the Museum of Contemporary Art, Los Angeles, she created 15 billboards and countless wild postings, executed and installed in both English and Spanish. For a public awareness campaign to promote arts instruction in the Los Angeles Unified School District, Kruger covered a bus with phrases like “Give your brain as much attention as you do your hair and you’ll be a thousand times better off”; “from here to there”; “Don’t be a jerk”; and “You want it. You buy it. You forget it.” In 2016, Kruger created a work protesting the election of Donald Trump for the cover of New York Magazine and participated in a January 20, 2017 inauguration boycott.

Kruger's early monochrome pre-digital works, known as ‘paste ups’, reveal the influence of the artist’s experience as a magazine editorial designer during her early career. These small scale works, the largest of which is 11 x 13 inches (28 x 33 cm), are composed of altered found images, and texts either culled from the media or invented by the Artist. A negative of each work was then produced and used to make enlarged versions of these initial ‘paste ups’. Between 1978 and 1979, she completed "Picture/Readings," simple photographs of modest houses alternating with panels of words. From 1992 on, Kruger designed several magazine covers, such as Ms., Esquire, Newsweek, and The New Republic. Her signature font style of Futura Bold type is likely inspired from the “Big Idea” or “Creative Revolution” advertising style of the 1960s that she was exposed to during her experience at Mademoiselle.

Kruger has said that "I work with pictures and words because they have the ability to determine who we are and who we aren’t." A larger category that threads through her work is the appropriation and alteration of existing images. In describing her use of appropriation, Kruger states: