Mikio Naruse was born in Tokyo in 1905. For a number of years he worked at the Shochiku film company under Shiro Kido as a property manager and later as an assistant Director. He was not permitted to direct a film at Shochiku until 1930, when he made his debut film, Mr. and Mrs. Swordplay (Chanbara fūfū).

Naruse's earliest extant work is Flunky, Work Hard (Koshiben gambare, also known as Little Man Do Your Best) from 1931, where he combined melodrama with slapstick, trying to meet the demands set by Shochiku's Kamata studio, who wanted a mix of laughter and tears. In 1933, he quit Shochiku, and began working for Photo-Chemical Laboratories (later known as Toho).

His first major film was Wife! Be Like a Rose! (1935) (Tsuma yo Bara no Yo ni). It won the Kinema Junpo, and was the first Japanese film to receive theatrical release in the United States (where it was not well received). The film concerns a young woman whose father deserted his family many years before for a geisha. As so often in Naruse's films, the portrait of the "other woman" is nuanced and sympathetic: It turns out, when the daughter visits her father in a remote mountain village, that the second wife is far more suitable for him than the first. The daughter brings her father back with her in order to smooth the way for her own marriage, but the reunion with the first wife – a melancholy poet – is disastrous: They have nothing in Common, and the father returns to wife number two.

Naruse filmed economically, using money- and time-saving techniques that other Directors shunned, such as shooting each actor delivering his or her lines of dialogue separately, and then splicing them together into chronological order in post-production (this reduced the amount of film wasted with each retake, and allowed a dialogue scene to be filmed with a single camera). Perhaps unsurprisingly, money is itself a major theme in these films, possibly reflecting Naruse's own childhood experience of poverty: Naruse is an especially mordant observer of the financial struggles within the family (as in Ginza Cosmetics, 1951, where the female protagonist ends up supporting all her relatives by working in a bar, or A Wife's Heart, 1956, where a couple is swindled out of a bank loan by the in-laws).

In the war years, Naruse went through a slow breakup with his wife Sachiko Chiba (who had starred in Wife! Be Like a Rose!). Naruse himself claimed to have entered a period of severe depression as a result of this. In the postwar period he collaborated with others more often, less frequently writing his own scripts. Notable successes included Mother (1952) (Okasan), a realistic look at family life in the postwar period, which received theatrical distribution in France, and 1955's Floating Clouds (Ukigumo), a doomed love story based (like many of Naruse's films) on a novel by Fumiko Hayashi.

Among Naruse's most revered films are Late Chrysanthemums (1954), Floating Clouds (1955), and When a Woman Ascends the Stairs (1960). Akira Kurosawa referred to Naruse's style of melodrama as "like a great river with a calm surface and a raging current in its depths".

His protagonists were usually women and his studies of female experience spanned a wide range of social milieux, professions and situations. A number of such films were adaptations of a single Novelist, Fumiko Hayashi, whose pessimistic outlook seemed to match his own. From her work he made films about unrequited passion (Floating Clouds 1955), unhappy families and stale marriages (Repast 1951, Wife 1953, Lightning 1952) and one about the struggle against material hardship and social oppression (Late Chrysanthemums 1954).

When a Woman Ascends the Stairs (1960) (Onna ga kaidan o agaru toki) tells the story of an aging bar hostess trying to adapt to modern times. Scattered Clouds (1967) (Midaregumo) (a.k.a. Two in the Shadow) was his last film, and is regarded as one of his greatest works. A tale of impossible love between a widow and the driver who accidentally killed her husband, it was made two years before his death.

Naruse's films contain simple screenplays, with minimal dialogue, unobtrusive camera work, and low-key production design. Earlier films employ a more experimental, expressionist style, but he is best known for the style of his later work: deliberately slow and leisurely, designed to magnify the everyday drama of ordinary Japanese people’s trials and tribulations, and leaving maximum scope for his actors to portray psychological nuances in every glance, gesture, and movement.