His personal name was Ilyas and his chosen pen-name was Nezami (also spelled as Nizami and Neẓāmi). He was born of an urban background in Ganja and is believe to have spent his whole life in Transcaucasia. Little is known about his life, the only source being his own work, which does not provide much information on his personal life.

Nezami was orphaned early and was raised by his maternal uncle Khwaja Umar who took responsibility for him and afforded him an excellent education. His mother, named Ra'isa, was of a Kurdish background. His father, whose name was Yusuf is mentioned once by Nezami in his poetry. In the same verse, Nezami mentions his grandfather's name as Zakki and his great grandfather's name as Mu'ayyad. Some sources have stated that his father might be possibly from Qom.

Nezami was at least half Iranian, but there exists a difference of opinion, about his father's ethnicity and Iranic and others have been mentioned.

Nezami was married three times. His first wife, Afaq, a Kipchak slave girl, was sent to him by Fakhr al-Din Bahramshah, the ruler of Darband, as a part of a larger gift. She became Nezami's first and most beloved wife. His only son Mohammad was from Afaq. Afaq died after "Khosrow and Shirin" was completed. Mohammad was seven at the time. Strangely enough, Nezami's other wives, too, died prematurely - the death of each coinciding with the completion of an epic, prompting the poet to say, "God, why is it that for every mathnavi I must sacrifice a wife!"

Nezami was not a philosopher in the sense of Avicenna or an expositor of theoretical sufism in the sense of Ibn 'Arabi. However, he is regarded as a philosopher and gnostic who mastered various fields of Islamic thoughts which he synthesized in a way that brings to mind the traditions of later Hakims such as Qutb al-Din Shirazi.

Often referred to by the honorific Hakim("the Sage"), Nezami is both a learned poet and master of a lyrical and sensuous style. About Nezami's prodigious learning there is no doubt. Poets were expected to be well versed in many subjects; but Nezami seems to have been exceptionally so. His poems show that not only he was fully acquainted with Arabic and Persian literatures and with oral and written popular and local traditions, but was also familiar with such diverse fields as mathematics, astronomy, astrology, alchemy, medicine, botany, Koranic exegesis, Islamic theory and law, Iranian myths and legends, history, ethics, philosophy and esoteric thought, music, and the visual arts.. His strong character, social sensibility, and knowledge of oral and written historical records, as well as his rich Persian cultural heritage unite pre-Islamic and Islamic Iran into the creation of a new standard of literary achievement.

The recent discovery and publication of the anthology titled Nozhat al-Majales contains Persian language quatrains from Nizami and 114 other poets from the northwestern Iran (Arrān, Šarvān, Azerbaijan; including 24 poets from Ganja alone) during the same era. Unlike other parts of Persia, where the poets mostly belonged to higher echelons of society such as scholars, bureaucrats, and secretaries, a good number of poets in the northwestern areas rose from among the common people with working class backgrounds, and they frequently used colloquial expressions in their poetry. Accordingly, the book demonstrates the social conditions at the time, reflecting the full spread of Persian language and the culture in the region, which is evidenced by the common use of spoken idioms in poems and the professions of many of the poets. The influence of the northwestern Pahlavi language, for example, which had been the spoken dialect of the region, is clearly observed in the poems contained in this anthology. However, at the same time, the Caucasus region was entertaining a unique mixture of ethnic cultures. Khaqani's mother was a Nestorian Christian, Mojir Baylqani's mother was an Armenian, and Nezami's mother was a Kurd. Their works reflect the cultural and linguistic diversity of the region.

The earliest extant example of Persian poetry from the area is that of Qatran Tabrizi who served in the courts of the Shaddadid and Rawadid dynasties. Qatran Tabrizi, is credited with what some scholars in the last century have termed as the founder of the "Azerbaijan" or "Trans-Cacausian" school of Persian poetry. This school produced a distinctive style of poetry in Persian, which contrasted with "Khurasani" ("Eastern") style in its rhetorical sophistication, its innovative use of metaphor and its use of technical terminology and Christian imagery. The Seljuqs took control of Ganja from the Shaddadids in 1075 A.D. and spread Persian literary westwards to their courts. In the middle of the twelfth century, the Seljuks control of the region weakened and their provincial governors, virtually autonomous local princes, further encouraged Persian culture, art and poetry in their courts. Nezami was patronized by different rulers and dedicated his epics to various rival dynasties including the Seljuqs, Eldiguzids, Shirvanshahs, the ruler of Ahar and Ahmadilis (Atabekan-e-Maragheh). Although he enjoyed the patronage of various rulers and princes, he avoided the court life and is generally believed to have lived a secluded life.

According to Professor Chelkowski: It seems that Nezami's favorite pastime was reading Firdawsi's monumental epic Shahnameh (The book of Kings).. Nezami has mentioned Ferdowsi as the Sage (Hakim) and Knower/Wise (daanaa) and the great master of discourse: who has decorated words like new bride. Nezami advises the son of the Shirvanshah to read the Shah-nama and to remember the meaningful sayings of the wise.. Nezami has used the Shahnameh as a source in his three epics of "Haft Paykar", "Khosrow and Shirin" and "Eskandar-nameh".

The story of Vis and Ramin also had an immense influence on Nezami. Although Nezami takes the bases for most of his plots from Ferdowsi, but the basis for his rhetoric comes from Gorgani. This is especially noticeable in the Khosrow and Shirin, which is of the same meter and imitates some scenes from Vis and Ramin. Nezami's concern with astrology also has a precedent in an elaborate astrological description of the night sky in Vis and Ramin. Nezami had a paramount influence on the romantic tradition, and Gorgani can be said to have initiated much of the distinctive rhetoric and poetic atmosphere of this tradition, with the absence of the Sufi influences, which are seen in Nezami's epic poetry.