He currently lives in Boca Raton, Florida, along with his second wife, Kim Pegula (née Kerr), a graduate of Houghton College and whose hometown is Fairport, New York. Kim was born in Seoul, South Korea, and at age 5 was adopted in 1973 by Ralph and Marilyn Kerr. He has five children, two from a previous marriage (Michael and Laura) and three with Kim (Jessica, Kelly and Matthew). Jessica Pegula is a tennis player on the Women's Tennis Association's Pro Circuit.

Pegula was born in Carbondale, Pennsylvania and he attended high school at Scranton Preparatory School. From there he attended college at Penn State University where he earned a Bachelor of Science degree in petroleum and natural gas engineering. During the 1980s, he was based in Allegany, New York.

Pegula has been identified as a Republican; he does not speak publicly about his specific political views. Pegula and his wife have made political donations to politicians of both parties, generally to incumbents. In 2010, Pegula and his wife donated $305,000 to Republican Tom Corbett's campaign during the Pennsylvania governor's race. They were the largest contributors for the Pennsylvania Attorney General. In New York, Pegula and his wife have donated $25,000 to New York Governor Andrew Cuomo's campaign during the 2014 elections and has also donated $12,000 to Buffalo mayor Byron Brown, $2,500 to senator Chuck Schumer and $250 to state senator Tim Kennedy, all Democrats. Pegula expressed support for legalizing ridesharing in upstate New York, the only area where it at the time remained illegal (New York State had until 2017 only legalized it in New York City) and has announced intent to partner with Uber to provide transportation to Pegula's sporting events.

In May 2011, Pegula began negotiations on behalf of the Sabres to re-purchase the Rochester Americans, which had served as the Sabres' American Hockey League affiliate from 1979 to 2008 (and had been owned by the Sabres from 1979 to 1996); the deal was completed in late June 2011. As part of the deal the Americans had to be split off from its NLL counterpart the Rochester Knighthawks since Pegula owned the Bandits. Along with the purchase of the Americans came upgrades to the team's arena, the Blue Cross Arena.

In 2012, he won a bid for the development rights to the Webster Block on Buffalo's waterfront. The $170 million hockey-themed HarborCenter building, which is anchored by the two rinks, a large parking garage, Retail, restaurants and a hotel, mostly opened in November 2014 with the rinks, restaurants and parking garage fully completed and opened in August 2015 with the completion and opening of the hotel and Retail. Pegula is also the operator of KeyBank Center. In 2017, Pegula purchased 79 Perry Street, near KeyBank Center and has teamed up with Labatt USA to redevelop the building into a mixed use facility to include a small test brewery and restaurant to be called the "John Labatt House" as well as Retail, commercial (which will include Labatt's new U.S. headquarters) and residential space. Pegula Sports and Entertainment's offices are based in the nearby Fairmont Creamery building.

This led to a domino effect across the men's college hockey landscape. Because six Big Ten universities now had Division I men's hockey programs (the minimum number of teams required under Big Ten bylaws for official conference sponsorship, and also the minimum required for a conference to be an automatic postseason qualifier), it was announced that Minnesota, Wisconsin, Michigan, Michigan State, and Ohio State would join Penn State in the Big Ten hockey conference starting in the 2013–2014 season. As a result, the CCHA ceased operations, with most schools (save for the three that joined the Big Ten and Notre Dame) joining the WCHA. Miami University and Western Michigan University, also previously in the CCHA, joined the upstart National Collegiate Hockey Conference along with former WCHA members St. Cloud State, Minnesota-Duluth, Denver, Colorado College, Nebraska-Omaha, and North Dakota. Ex-CCHA member Notre Dame joined Hockey East, which then recruited UConn from the Atlantic Hockey Association to begin play in Hockey East in 2014. After the dust settled, the ECAC was the only Division I conference not affected by the major conference realignment.

The Pegulas donated $12 million to Houghton College in Houghton, New York, of which Kim Pegula is an alumna, to build the Kerr-Pegula Athletic Complex. The facility includes new baseball and softball stadiums and a 115,000 square-foot field house with an eight-lane 200-meter track, five tennis courts, weight room, cardiac fitness center, and locker rooms. The new facility is mainly targeted toward Houghton College intercollegiate athletics, which recently moved up to Division III Athletics and the Empire 8 Conference. It opened on October 4, 2014.

On December 21, 2017, it was announced that Pegula had acquired the Buffalo Beauts of the National Women's Hockey League. This made the Beauts the first NWHL team not owned by the league, the first professional women's hockey team in North America owned by the same person that owned the market's NHL team and got Pegula into women's hockey.

In early 2018, JKLM Energy became involved in a controversial proposal for a fracking wastewater plant near Coudersport, Pennsylvania. JKLM intends to truck "produced water" (fracking wastewater) to the plant for treatment and disposal into the headwaters of the Allegheny River when and if the plant is approved and licensed by governmental authorities. This plant proposal is opposed by many residents of Coudersport and Potter County as well as by the Seneca Nation of Indians who reside downriver from the proposed plant location. The Pennsylvania Department of Environmental Protection fined JKLM $472,317 in 2016 for groundwater contamination caused by the use of an unapproved surfactant during the drilling of a natural gas well. The contamination impacted six private drinking water wells in Sweden and Eulalia townships, Potter County. The Cattauragus County, New York, legislature as well as New York State Senator Catharine Young have joined the Seneca Nation in opposition to the proposed fracking wastewater plant. Additionally, the Coudersport Bourough Council voted to oppose the siting of the plant near Coudersport. The Coudersport Borough Council's resolution of opposition was forwarded to the Coudersport Area Municipal Authority (CAMA), who has not yet considered it in a public forum.