Ambartsumian was born in Tbilisi (now in Georgia), the son of a distinguished Armenian philologist. He graduated from the University of Leningrad in 1928 and did graduate work at Pulkovo Observatory, near Leningrad, from 1928 to 1931. He was professor of astrophysics from 1934 to 1946 at Leningrad and held the same post from 1947 at the State University at Yerevan in Armenia. In 1946 he organized the construction, near Yerevan, of the Byurakan Astronomical Observatory, having been appointed its director in 1944. He remained as director until 1988.

Ambartsumian's work was mainly concerned with the evolution of stellar systems, both galaxies and smaller clusters of stars, and the processes taking place during the evolution of stars. The idea of a stellar ‘association’ was introduced into astronomy by Ambartsumian in 1947. Associations are loose clusters of hot stars that lie in or near the disk-shaped plane of our Galaxy. They must be young, no more than a few million years old, as the gravitational field of the Galaxy will tend to disperse them. This must mean that star formation is still going on in the Galaxy.

He also argued in 1955 that the idea of colliding galaxies proposed by Rudolph Minkowski and Walter Baade to explain such radio sources as Cygnus A would not produce the required energy. Instead, he proposed that the source of energy was gigantic explosions occurring in the dense central regions of galaxies and these would be adequate to provide the 10⁵⁵ joules emitted by the most energetic radio sources.