Esha Deol was born in Mumbai, Maharashtra, India on 2 November 1981. She was given the full name of Esha Dharmendra Deol. The name 'Esha' comes from the Upanishads and is derived from the Sanskrit language meaning "the Divine beloved". She is the elder daughter of Bollywood actors Dharmendra and Hema Malini. She has a younger sister named Ahana. She is the half sister of actors Sunny Deol and Bobby Deol and first cousin of actor Abhay Deol. She is Punjabi on her father's side and Tamil on her mother's side and speaks Tamil with her mother and sister.

Deol decided to join the acting line of her parents and became a second-generation Actress. She started her acting career in a lead role with Vinay Shukla's Koi Mere Dil Se Poochhe (2002) opposite Aftab Shivdasani, with Sanjay Kapoor, Jaya Bachchan and Anupam Kher playing supporting roles. This movie was a box office failure. Deol received mixed reactions from critics upon her performance. Savera R Someshwar of Rediff wrote "Esha, as a person, exudes a confidence that almost borders on arrogance. She's athletic and seems perfectly capable of looking after herself in any situation. Esha, on screen, is required to convey three emotions: Love, sorrow and fear. Especially fear. No wonder she flounders. She is just unable to look terrorised. Even her alleged romance with costar Aftab has not helped her shed her stern demeanour in her romantic scenes." Rakesh Budhu of Planet Bollywood wrote "She isn’t horrible, but given the hype, the demands and of course, comparisons, she surely isn’t up to the mark. Koi Mere Dil Se Poochhe is just plain old mediocre in such a way that you end up noticing the flaws in Esha’s performance more. Her facial expressions need work, her attitude is beautiful but she seems too stern when it is not required. Of course, she is nowhere close to being a washout and if you are her fan you can appreciate the other aspects of her performances without completely losing faith in her Future projects." Despite mixed reactions and box office failure, Deol won numerous awards for her performance including the Filmfare Award for Best Female Debut at the 48th Filmfare Awards.

Deol's first two movies of 2003: Kucch To Hai and Chura Liyaa Hai Tumne were box office failures. For Kucch To Hai, Deol earned mixed reviews from Taran Adarsh, who wrote "Esha Deol shows improvement in terms of performance as well as her overall appearance." Taran Adarsh considered Deol to be "alright" in Chura Liyaa Hai Tumne. Ronjita Kulkarni praised her performance in Chura Liyaa Hai Tumne, writing "Chura Liya... was supposed to give Esha a makeover and re-launch her. Strangely, her role is similar to her debut, Koi Mere Dil Se Pooche. While the former had her terrified of her husband, Chura Liya... sees her terrified of three Gangsters. The film gives her ample scope for histrionics, but she does not use it. Her dialogue delivery is good, but her performance is hyper." Deol was one of the heroines of J.P. Dutta's multi starrer war epic LOC Kargil and was paired with Abhishek Bachchan. Though Deol and all the other heroines could not get much scope, she earned critical acclaim for her performance. The film became the sixth highest-grossing movie of the year.

In 2004, Deol made her debut in Tamil cinema by playing a French Teacher in Mani Ratnam's political film Aayutha Ezhuthu opposite Suriya. She earned critical acclaim for her performance. Sify.com defined her as "surprisingly fresh and sparkling". In order to prepare for her role, Deol learned nuances of the language with Mani Ratnam's assistant R. Kannan. After completing Aayutha Ezhuthu, Deol started filming the Hindi version of the movie titled Yuva. In Yuva, Deol repeated the same role and was paired opposite Ajay Devgn. Prem Panicker of Rediff wrote "Esha Deol is the surprise package among the troika. While hers is the least developed character, she still manages to show flashes of her inherited acting genes." Taran Adarsh wrote "Esha Deol justifies her part, but her role doesn't demand histrionics either." Both movies were released on the same date but could not attain success. Yuva had a below average opening and flopped at the box office.

After the success of Dhoom, Deol starred in Krishna Vamsi's war film Insan opposite Akshay Kumar. It was Deol's first release of 2005. The film was a failure at the box office. Her next release was Main Aisa Hi Hoon opposite Ajay Devgn. The film was a remake of the critically acclaimed Hollywood movie I Am Sam (2001). Deol played a supporting role and earned praise by Patcy N. Subhash K. Jha of IANS also praised Deol, writing "Esha Deol as the fey unstable nomadic and maladjusted Maya is a mix of Zeenat Aman in Hare Rama Hare Krishna and Anooradha Patel in Ijaazat. Playing this zonked-out character Esha Deol comes into her own as an Actress. Her far-way looks of pain anger neglect and insecurity remain with you long after the film. Yup she too has matured along with Hindi cinema."

In 2007, Deol's portrayal of a notorious and vengeful ghost for Ram Gopal Verma's Darling was reviewed positively. Taran Adarsh noted that, "Esha Deol is excellent in a role that’s nothing short of a challenge. It would’ve boomeranged had it been entrusted to any inferior actor, but Esha is in terrific form here. This should be the turning point in her career." Her next release was Cash again opposite Ajay Devgn.

In 2008, she performed her first item number in Ajay Devgn's film Sunday. She further appeared in Hijack and took a sabbatical break from films for two years.

Deol's next film was Tell Me O Kkhuda (2011) directed and produced by her mother Hema Malini. She portrayed the lead role in the film opposite Arjan Bajwa, Vinod Khanna, Rishi Kapoor and her father Dharmendra.

Esha Deol got engaged to her boyfriend Bharat Takhtani, a businessman of Sindhi descent on 12 February 2012 and married him on 29 June 2012. On 24 April 2017, it was announced that the couple was expecting their first child. She gave birth to a baby girl, Radhya Takhtani, on October 20, 2017 at Hinduja Hospital in Mumbai.

Deol finally got her breakthrough with Yash Raj Films' action film Dhoom opposite Abhishek Bachchan, John Abraham, Uday Chopra and Rimi Sen. It was Deol's first action role and she was paired opposite Chopra. The film had a decent opening and became a hit at the box office, becoming the fourth-highest-grossing movie at the box office. Deol did not get much scope in the film but her performance earned her a nomination for the IIFA Award for Best Supporting Actress at the 6th IIFA Awards. Critics considered Deol and Rimi Sen's performances to be nothing more than beauties and their purpose was defined as providing sex appeal. Surjyakiran Das of Planet Bollywood wrote "It’s most fitting to mention actresses Esha Deol and Rimi Sen while discussing the music and choreography; they seem to turn up in the film only when the heroes feel like crooning a tune and shaking a leg with a loved one. Both actresses do convincing enough work in their roles, but their real purpose is to provide sex appeal." Rajesh Karkera wrote "Esha Deol and Rimii Sen only need to look beautiful in their limited presence in this sweat 'n' leather flick."