Born in Sarajevo (now in Bosnia and Hercegovina), Prelog studied chemistry at the Prague Institute of Technology where he received his doctorate in 1929. He then worked in Prague as an industrial chemist until 1935 when he moved to the University of Zagreb. With the German invasion of Yugoslavia in 1941 Prelog joined the staff of the Federal Institute of Technology in Zurich, serving there as professor of chemistry from 1950 until his retirement in 1976.

Prelog's early work was with the alkaloids. His research resulted in the solution of the configuration of Cinchona alkaloids (antimalarial compounds), the correction of the formulas for Strychnos alkaloids, and the elucidation of many other indole, steroid, and aromatic alkaloid configurations. He later investigated the metabolites of certain microorganisms and in so doing discovered many new natural substances including the first natural compound found to contain boron, boromycin.

Prelog intensively studied the relationship between conformation and chemical activity in medium-sized (8–11 ring members) ring structures. This brought to light a new type of reaction that can occur in such compounds. Prelog next showed that conformation affects the outcome of syntheses where different-sized atoms or groups are being substituted into a compound. The regular way in which this occurs allowed the configurations of many important compounds to be worked out. Applying such work to the reactions between enzymes, coenzymes, and substrates gave interesting results about the stereospecificity of microorganisms.

With Christopher Ingold, Prelog introduced the so-called R–S system into organic chemistry, which allowed, for the first time, enantiomers, or mirror images, to be described unambiguously.

For such wide ranging work on the “stereochemistry of organic molecules and reactions” Prelog was awarded the 1975 Nobel Prize for chemistry, which he shared with John Cornforth.