Ellis was born in Los Angeles and raised in Sherman Oaks in the San Fernando Valley. His father, Robert Martin Ellis, was a property developer, and his mother, Dale (Dennis) Ellis, was a homemaker. They divorced in 1982. Ellis stated, during the initial release of his third novel American Psycho, that his father was abusive, and he became the basis of that book's best-known character Patrick Bateman. Later, Ellis claimed the character was not in fact based on his father, but on Ellis himself, saying that all of his work came from a specific place of pain he was going through in his life during the writing of each of his books. Ellis claims that while his family life growing up was somewhat difficult due to the divorce, he mostly had an "idyllic" California childhood.

After the success and controversy of Less Than Zero in 1985, Ellis became closely associated and good friends with fellow Brat Pack Writer Jay McInerney: the two became known as the "toxic twins" for their highly publicized late night debauchery.

Camden is introduced in Less Than Zero, where it is mentioned that both protagonist Clay and minor character Daniel attend it. In The Rules of Attraction (1987), where Camden is the setting, Clay (referred to as "The Guy from L.A." before being properly introduced) is a minor character who narrates one chapter; ironically, he longs for the Californian beach, where in Ellis' previous novel he had longed to return to college. On "the guy from L.A.'s door someone wrote "Rest in Peace Called"; R.I.P., or Rip, is Clay's dealer in Less Than Zero; Clay also says that Blair from Less than Zero sent him a letter saying she thinks Rip was murdered. Main character Sean Bateman's older brother Patrick narrates one chapter of the novel; he would be the infamous central character of Ellis' next novel, American Psycho. Ellis includes a reference to Tartt's forthcoming Secret History in the form of a passing mention of "that weird Classics group ... probably roaming the countryside sacrificing farmers and performing pagan rituals." There is also an allusion to the main character from Eisenstadt's From Rockaway.

In American Psycho (1991), Patrick's brother Sean appears briefly. Paul Denton and Victor Johnson from The Rules of Attraction are both mentioned; on seeing Paul, Patrick wonders if "maybe he was on that cruise a long time ago, one night last March. If that's the case, I'm thinking, I should get his telephone number or, better yet, his address." Camden is referred to as both Sean's college and the college a minor character named Vanden is going to. Vanden was referred to (but never appeared) in both Less Than Zero and The Rules of Attraction. Passages from "Less Than Zero" reappear, almost verbatim, here, with Patrick replacing Clay as narrator. Patrick also makes repeated references to Jami Gertz, the Actress who portrays Blair in the 1987 film adaptation of Less Than Zero. Allison Poole from Jay McInerney's 1988 novel Story of My Life appears as a torture victim of Patrick's. 1994's The Informers features a much-younger Timothy Price, one of Patrick's co-workers in American Psycho, who narrates one chapter. One of the central characters, Graham, buys concert tickets from Less Than Zero's Julian, and his sister Susan goes on to say that Julian sells heroin and is a male prostitute (as shown in Zero). Alana and Blair from Zero are also friends of Susan's. Letters to Sean Bateman from a Camden College girl named Anne visiting grandparents in LA comprise the eighth chapter.

Ellis often uses recurring characters and settings. Major characters in one novel may become minor ones in the next, or vice versa. Camden College, a fictional New England liberal arts college, is frequently referenced. It is based on Bennington College, which Ellis himself attended, where he met Future Novelist Jonathan Lethem and befriended fellow Writers Donna Tartt and Jill Eisenstadt. In Tartt's The Secret History (1992), her version of Bennington is given as "Hampden College," although there are oblique connections between it and Ellis' Rules of Attraction. Eisenstadt and Lethem, however, use 'Camden' in From Rockaway (1987) and The Fortress of Solitude (2003), respectively. Though his three major settings are Vermont, Los Angeles and New York, he doesn't think of these novels as about these places; they are intentionally more universal than that.

Ellis's collection of short stories, The Informers, was published in 1994. It contains vignettes of wayward Los Angeles characters ranging from rock stars to vampires, mostly written while Ellis was in college, and so has more in Common with the style of Less Than Zero. Ellis has said that the stories in The Informers were collected and released only to fulfill a contractual obligation after discovering that it would take far longer to complete his next novel than he'd intended. After years of struggling with it, Ellis released his fourth novel Glamorama in 1998. Glamorama is set in the world of high fashion, following a male model who becomes entangled in a bizarre terrorist organization composed entirely of other Models. The book plays with themes of media, Celebrity, and political violence, and like its predecessor American Psycho it uses surrealism to convey a sense of postmodern dread. Although the reactions to the novel were mixed, Ellis holds it in high esteem among his own works: "... it's probably the best novel I've written and the one that means the most to me. And when I say "best"—the wrong word, I suppose, but I'm not sure what else to replace it with—I mean that I'll never have that Energy again, that kind of focus sustained for eight years on a single project. I'll never spend that amount of time crafting a book that means that much to me. And I think people who have read all of my work and are fans understand that about Glamorama—it's the one book out of the seven I've published that matters the most." Ellis's novel Lunar Park (2005), uses the form of a Celebrity memoir to tell a ghost story about the Novelist "Bret Easton Ellis" and his chilling experiences in the apparently haunted home he shares with his wife and son. In keeping with his usual style, Ellis mixes absurd comedy with a bleak and violent vision.

Patrick Bateman appears briefly in Glamorama (1998); Glamorama's main characters Victor Ward and Lauren Hynde were first introduced in The Rules of Attraction. As an in-joke reference to Bateman being portrayed by Christian Bale in the then-in-production 2000 film adaptation, the actor himself briefly appears as a background character. The book also includes a spy called Russell who is physically identical to Bale, and at one point in the novel impersonates him. Jaime Fields, who has a major role in the book, was first briefly mentioned by Victor in The Rules of Attraction. Bertrand, Sean and Mitchell, all from The Rules of Attraction, appear in Camden flashbacks and several other Rules characters are referenced. McInerney's Alison Poole makes her second appearance in an Ellis novel as Victor's mistress. Lunar Park (2005) is not set in the same "universe" as Ellis' other novels, but contains a similar multitude of references and allusions. All the author's previous works are heavily referenced, in keeping with the book-within-a-book structure. Jay McInerney cameos. Donald Kimball from American Psycho questions Ellis on a series of American Psycho-inspired murders, Mitchell Allen from Rules lives next door to and went to college with Ellis (Ellis even recalls his affair with Paul Denton, alluded to in Rules), and Ellis recalls a tempestuous relationship with Blair from Zero. Imperial Bedrooms (2010) establishes the conceit that the Clay depicted in Zero is not the same Clay who narrates Bedrooms. In the world of Imperial Bedrooms, Zero was the close-to-non-fiction work of an author friend of Clay's, and its film adaptation (featuring actors Andrew McCarthy, Jami Gertz and Robert Downey, Jr.) exists within the world of the novel, too.

In a 1999 interview, the author suggested that his reluctance to definitively label his sexuality is for "artistic reasons". He commented: "if people knew that I was straight, they'd read [my books] in a different way. If they knew I was gay, 'Psycho' would be read as a different book." In an interview with Robert F. Coleman, Ellis said his was an "indeterminate sexuality," that "any other interviewer out there will get a different answer and it just depends on the mood I am in." In a 2011 interview with James Brown, Ellis again stated that his answers to questions about his sexuality have varied from interviewer to interviewer, and he cited an Example where his reluctance to refuse the label "bi" had him labelled as such by a Details interviewer. "I think the last time I slept with a woman was five or six years ago, so the bi thing can only be played out so long," he clarified. "But I still use it, I still say it." Responding to Dan Savage's It Gets Better campaign, aimed at preventing suicide among LGBT youth, Ellis tweeted: "Not to bum everyone out, but can we get a reality check here? It gets worse." In a 2012 op-ed for The Daily Beast, while apologizing for a series of controversial tweets, Ellis identified himself as a gay man.

When asked in an interview in 2002 whether he was gay, Ellis explained that he does not identify himself as gay or straight; he is comfortable being thought of as homosexual, bisexual, or heterosexual, and enjoys playing with his persona, identifying variously as gay, straight, and bisexual to different people over the years.

Ellis was approached by young Screenwriter Nicholas Jarecki to adapt The Informers into a film; the script they co-wrote was cut from 150 to 94 pages and taken from Jarecki to give to Australian Director Gregor Jordan, whose light-on-humor vision of the film was met with unanimously negative reviews when the film was released in 2009.

In 2010, Ellis released a follow-up to Less Than Zero entitled Imperial Bedrooms (2010). Taking place 25 years after the events of Ellis' debut novel, it combines the postmodernism of Lunar Park with the unaltered ennui of Less Than Zero. The book was met with disappointing sales.

In 2012, Ellis wrote the screenplay for the independent film The Canyons and helped raise money for its production. The film was released in 2013 and although critically panned, was a small financial success, with the performance of Lindsay Lohan in the lead role earning some positive reviews.

On November 18, 2013, Ellis launched a podcast with PodcastOne Studios. The aim for the show, which delivers 1 hour segments, is to have Ellis engage in open and honest conversation with his guests about their work, inspirations, life experiences as well as music and movies. Ellis, who has always been averse to publicity, has been using the platform to engage in intellectual conversation and debate about his own theoretical observations on the media, the film industry, the music scene and the analog vs. digital age in a generational context. Notable guests have included Kanye West, Marilyn Manson, Judd Apatow, Chuck Klosterman, Kevin Smith, Michael Ian Black, Matt Berninger, Brandon Boyd, BJ Novak, Gus Van Sant, Joe Swanberg, Ezra Koenig, Stephen Malkmus, John Densmore, Fred Armisen & Carrie Brownstein, Ivan Reitman, and Adam Carolla.

As of the spring of 2014, Ellis has been filming in and around Los Angeles. On his Podcast he had stated that he writes scenes and then when certain locations, equipment and his actors are available, they will spontaneously shoot the material, with Ellis directing. He has also stated via his Podcast, his Twitter, his Instagram and his Facebook that he does not know what form this project will take when they complete it. It could be a feature film or a web-series. The project's Producer, and Ellis' producing partner, Braxton Pope, has been regularly posting updates and pictures from the production on his Facebook and Instagram accounts.