Emil Julius Klaus Fuchs was born in Rüsselsheim, Grand Duchy of Hesse, on 29 December 1911, the third of four children of a Lutheran pastor, Emil Fuchs, and his wife Else Wagner. Fuchs was always known by his last given name, Klaus. He had an older brother Gerhard, an older sister Elisabeth, and a younger sister, Kristel. The family moved to Eisenach, where Fuchs attended the gymnasium, and took his Abitur. At school, Fuchs and his siblings were taunted over his father's unpopular political views, which they came to share. They became known as the "red foxes", Fuchs being the German word for fox.

Fuchs entered the University of Leipzig in 1930, where his father was a professor of theology. He became involved in student politics, joining the student branch of the Social Democratic Party of Germany (SPD), a party that his father had joined in 1912, and the Reichsbanner Schwarz-Rot-Gold, the party's paramilitary organisation. His father took up a new position as professor of religion at the Pedagogical Academy in Kiel, and in the autumn Fuchs transferred to the University of Kiel, which his brother Gerhard and sister Elisabeth also attended. Fuchs continued his studies in mathematics and physics at the university. In October 1931, his mother committed suicide by drinking hydrochloric acid. The family later discovered that his maternal grandmother had also taken her own life.

In the March 1932 German presidential election, the SPD supported Paul von Hindenburg for President, fearing that a split vote would hand the job to the National Socialist German Workers' Party (NSDAP) candidate, Adolf Hitler. However, when the Communist Party of Germany (KPD) ran its own candidate, Ernst Thälmann, Fuchs offered to speak for him, and was expelled from the SPD. That year Fuchs and all three of his siblings joined the KPD. Fuchs and his brother Gerhard were active speakers at public meetings, and occasionally attempted to disrupt NSDAP gatherings. At one such gathering, Fuchs was beaten up and thrown into the river.

After Emil was arrested in 1933, Kristel fled to Zurich, where she studied education and psychology at the University of Zurich. She returned to Berlin in 1934, where she too worked at the car rental agency. In 1936, Emil arranged with Quaker friends in the United States for Kristel to attend Swarthmore College there. She visited Fuchs in England en route to America, where she eventually married an American communist, Robert Heineman, and settled in Cambridge, Massachusetts. She became a permanent resident in the United States in May 1938. In 1936, Kittowski and Elisabeth were arrested again, and the rental cars were impounded. Gerhard and Karin fled to Czechoslovakia. Elisabeth was released and went to live with Emil, while Kittowski, sentenced to six years, later escaped from prison and also made his way to Czechoslovakia. In August 1939, Elisabeth committed suicide by throwing herself from a train, leaving Emil to raise young Klaus.

Fuchs applied to become a British citizen in August 1939, but his application had not been processed before the Second World War broke out in Europe in September 1939. There was a classification system for enemy aliens, but Born provided Fuchs with a reference that said that he had been a member of the SPD from 1930 to 1932, and an anti-Nazi. There, matters stood until June 1940, when the police arrived and took Fuchs into custody. He was first interned on the Isle of Man and then, in July, he was sent to an internment camp in Sherbrooke, Quebec, Canada. During his internment in 1940, he continued to work and published four more papers with Born: The Mass Centre in Relativity, Reciprocity, Part II: Scalar Wave Functions, Reciprocity, Part III: Reciprocal Wave Functions and Reciprocity, Part IV: Spinor Wave Functions, and one by himself, On the Statistical Method in Nuclear Theory.

While interned in Quebec he joined a communist discussion group led by Hans Kahle. Kahle was a KPD member who had fought in the Spanish Civil War. After fleeing to Britain with his family, Kahle had helped Jurgen Kuczynski organise the KPD in Britain. Kristel arranged for Israel Halperin, the brother-in-law of a friend of hers, Wendell Furry, to bring Fuchs some magazines. Max Born lobbied for his release. On Christmas Day 1940, Fuchs and Kahle were among the first group of internees to board a ship to return to Britain.

After the Second World War broke out in Europe, he was interned on the Isle of Man, and later in Canada. After he returned to Britain in 1941, he became an assistant to Rudolf Peierls, working on "Tube Alloys"—the British atomic bomb project. He began passing information on the project to the Soviet Union through Ruth Kuczynski, codenamed "Sonia", a German communist and a major in Soviet Military Intelligence who had worked with Richard Sorge's spy ring in the Far East. In 1943, Fuchs and Peierls went to Columbia University, in New York City, to work on the Manhattan Project. In August 1944, Fuchs joined the Theoretical Physics Division at the Los Alamos Laboratory, working under Hans Bethe. His chief area of expertise was the Problem of implosion, necessary for the development of the plutonium bomb. After the war, he returned to the UK and worked at the Atomic Energy Research Establishment at Harwell as head of the Theoretical Physics Division.

Fuchs returned to Edinburgh in January, and resumed working for Born. In May 1941, he was approached by Rudolf Peierls of the University of Birmingham to work on the "Tube Alloys" program – the British atomic bomb research project. Despite wartime restrictions, he was granted British citizenship on 7 August 1942 and signed an Official Secrets Act declaration form. As accommodation was scarce in wartime Birmingham, he stayed with Rudolf and Genia Peierls. Fuchs and Peierls did some important work together, which included a fundamental paper about isotope separation.

In late 1943, Fuchs (codename: "Rest"; he became "Charles" in May 1944) transferred along with Peierls to Columbia University, in New York City, to work on gaseous diffusion as a means of uranium enrichment for the Manhattan Project. Although Fuchs was "an asset" of GRU in Britain, his "control" was transferred to the NKGB (Russian: Народный Kомиссариат Государственной Безопасности), the Soviet Union's civilian intelligence organisation, when he moved to New York. He spent Christmas 1943 with Kristel and her family in Cambridge. He was contacted by Harry Gold (codename: "Raymond"), an NKGB agent in early 1944.

From August 1944 Fuchs worked in the Theoretical Physics Division at the Los Alamos Laboratory, under Hans Bethe. His chief area of expertise was the Problem of imploding the fissionable core of the plutonium bomb. At one point, Fuchs did calculation work that Edward Teller had refused to do because of lack of interest. He was the author of techniques (such as the still-used Fuchs-Nordheim method) for calculating the Energy of a fissile assembly that goes highly prompt critical, and his report on blast waves is still considered a classic. Later, he also filed a patent with John von Neumann, describing a method to initiate fusion in a thermonuclear weapon with an implosion trigger. Fuchs was one of the many Los Alamos Scientists present at the Trinity test. Bethe considered Fuchs "one of the most valuable men in my division" and "one of the best theoretical physicists we had."

According to On a Field of Red, a history of the Comintern (Communist International) by Anthony Cave Brown and Charles B. MacDonald, Fuchs's greatest contribution to the Soviets may have been disclosing how uranium could be processed for use in a bomb. Fuchs gave Gold technical information in January 1945 that was acquired only after two years of experimentation at a cost of $400 million. Fuchs also disclosed the amount of uranium or plutonium the Americans planned to use in each atomic bomb.

He was highly regarded as a scientist by the British, who wanted him to return to the United Kingdom to work on Britain's post-war nuclear weapons program; he returned in August 1946 and became the head of the Theoretical Physics Division at the Atomic Energy Research Establishment at Harwell. From late 1947 to May 1949 he gave Alexander Feklisov, his Soviet case officer, the principal theoretical outline for creating a hydrogen bomb and the initial drafts for its development as the work progressed in England and America. Meeting with Feklisov six times, he provided the results of the test at Eniwetok Atoll of uranium and plutonium bombs and the key data on production of uranium-235.

Under interrogation by MI5 officer william Skardon at an informal meeting in December 1949, Fuchs initially denied being a spy and was not detained. In January 1950, Fuchs arranged another interview with Skardon and voluntarily confessed that he was a spy. Three days later, he also directed a statement more technical in content to Michael Perrin, the deputy controller of atomic Energy within the Ministry of Supply. Fuchs told interrogators that the NKGB had acquired an agent in Berkeley, California, who had informed the Soviet Union about electromagnetic separation research of uranium-235 in 1942 or earlier. Fuchs's statements to British and American intelligence agencies were used to implicate Harry Gold, a key witness in the trials of David Greenglass and Julius and Ethel Rosenberg in the United States.

It is likely that Fuchs's espionage led the U.S. to cancel a 1950 Anglo-American plan to give Britain American-made atomic bombs. He was prosecuted by Sir Hartley Shawcross, and was convicted on 1 March 1950 of four counts of breaking the Official Secrets Act by "...communicating information to a potential enemy." After a trial lasting less than 90 minutes, Lord Goddard sentenced him to fourteen years' imprisonment, the maximum for espionage, because the Soviet Union was classed as an ally at the time. In December 1950, he was stripped of his British citizenship. The head of the British H-bomb project, Sir william Penney, visited Fuchs in prison in 1952.

Whether the information Fuchs passed relating to the hydrogen bomb would have been useful is still debated. Most scholars agree with Hans Bethe's 1952 assessment, which concluded that by the time Fuchs left the thermonuclear program in mid-1946, too little was known about the mechanism of the hydrogen bomb for his information to be useful to the Soviet Union. The successful Teller-Ulam design was not devised until 1951. Soviet physicists later noted that they could see as well as the Americans eventually did that the early designs by Fuchs and Edward Teller were useless.

Fuchs was released on 23 June 1959, after serving nine years and four months of his sentence (as then required in England where long-term prisoners were entitled by law to one-third off for good behaviour in prison) at Wakefield Prison and promptly emigrated to the German Democratic Republic (East Germany). A tutorial he gave to Qian Sanqiang and other Chinese physicists helped them to develop the first Chinese atomic bomb, the 596, which was tested five years later—according to Thomas Reed and Daniel Stillman, the authors of The Nuclear Express: A Political History of the Bomb and Its Proliferation (2009). Three historians of nuclear weapons history, Robert S. Norris, Jeremy Bernstein, and Peter D. Zimmerman, challenged this particular assertion as "unsubstantiated conjecture" and asserted that The Nuclear Express is "an ambitious but deeply flawed book".

In 1959, Fuchs married a friend from his years as a student communist, Grete (Margarete) Keilson. He continued his scientific career and achieved considerable prominence. He was elected to the Academy of Sciences and the SED central committee and was later appointed deputy Director of the Institute for Nuclear Research in Rossendorf, where he served until he retired in 1979. He received the Patriotic Order of Merit, the Order of Karl Marx and the National Prize of East Germany. He died in Berlin on 28 January 1988. He was cremated and his ashes buried in the "Pergolenweg" of the Socialists' Memorial in Berlin's Friedrichsfelde Cemetery.

Klaus Fuchs's main courier was Harry Gold. Allen Weinstein, the author of The Haunted Wood: Soviet Espionage in America (1999), has pointed out: "The NKVD had chosen Gold, an experienced group handler, as Fuchs' contact on the grounds that it was safer than having him meet directly with a Russian operative, but Semyon Semyonov was ultimately responsible for the Fuchs relationship."

Later archival work by Soviet Physicist German Goncharov (ru) suggested that while Fuchs's early work did not help Soviet efforts towards the hydrogen bomb, it was closer to the final correct solution than anyone recognized at the time—and indeed spurred Soviet research into useful problems that eventually provided the correct answer. Since most of Fuchs's work on the bomb, including a 1946 patent on a particular model for the weapon, are still Classified in the United States, it has been difficult for scholars to fully assess these conclusions. In any case, it seems clear that Fuchs could not have just given the Soviets the "secret" to the hydrogen bomb, since he did not himself actually know it.