Liebig, who was born in Darmstadt, Germany, was the son of a dealer in drugs, dyes, and associated chemicals. Aided by his father he developed an early interest in chemistry and was apprenticed to an apothecary. He studied chemistry at Bonn and Erlangen, after which the grand duke of his native Hesse was persuaded to finance Liebig to pursue his chemical studies overseas. Consequently he went to Paris, where he worked in the laboratory of Joseph Gay-Lussac. While there he came into contact with Alexander von Humboldt, who exercised his patronage to have Liebig appointed to the chair of chemistry at Giessen in 1825, when he was still only 21. He remained there until 1852, when he moved to the University of Munich.

Liebig did much to establish chemistry as a discipline. At Giessen he set up one of the first laboratories for student instruction through which most of the great chemists of the 19th century passed. He also started the first scholarly chemical periodical. In 1832 he took over the Annalen der Pharmacie (Annals of Pharmacy) and renamed it in 1840 the Annalen der Chemie (Annals of Chemistry; the periodical still exists). He was constantly looking for ways to spread chemistry into new areas, to assert its dominance in previously autonomous disciplines. Thus in a series of works after 1840, when he moved from pure to applied organic chemistry, he tried to show that such studies as agriculture, physiology, and pathology were only intelligible when based on sound chemical principles. His Chemistry in its Applications to Agriculture and Physiology (1840) was one of the great books of the century. By 1848 it had gone through 17 editions and appeared in 8 languages. It was followed two years later by his Organic Chemistry in its Application to Pathology and Physiology.

Liebig's first significant discovery was made with the aid of Friedrich Wöhler, his lifelong collaborator and friend. While working in the laboratory of Gay-Lussac, Liebig had prepared silver fulminate; Wöhler working in Sweden in the laboratory of Berzelius had prepared silver cyanate. To their surprise these two different chemicals appeared to have the same formula. They had unwittingly discovered what Berzelius was to call isomerism, that is, the condition in which two different chemical compounds have the same molecular formula.

They decided to work together on the growing crisis in organic chemistry: how to deal with the sheer size and complexity of the molecules. (Molecules of inorganic compounds tend to be relatively small and straightforward and thus presented fewer problems.) Together they developed a method of analyzing the amounts of carbon and hydrogen present in organic compounds.

Liebig and Wöhler came up with a theory of compound radicals. In 1832 they introduced the benzoyl radical, arguing for the existence of a family of chemicals all made from the same radical with the addition of one or more atoms to differentiate them. Thus to the benzoyl radical, C₆H₅.CO, can be added OH to make benzoic acid, H to make oil of bitter almonds (benzaldehyde), Cl for benzoyl chloride, Br for benzoyl bromide, and so on. Unfortunately it was difficult to find another radical as productive and convincing as benzoyl. However, this could not detract from the important fact that they had shown that organic compounds could be dealt with in a rational way.

After organic chemistry Liebig's greatest work was carried out in agricultural science. His first achievement was in rejecting the current humus theory – the belief that plants absorb carbon from humus, the organic part of the soil, and turn it into the minerals they need. He demonstrated the falsity of this by showing that some crops left the soil richer in carbon than they found it, claiming that plants obtain carbon from the air. On burning plants he found various minerals present and argued that these must be obtained from the soil. He also thought that nitrogen was obtained from the ammonia in the soil, which ultimately derived from the rain. Thus plant growth could be stimulated with nitrates, manures, and minerals in which the soil was deficient. He experimented on a plot of land from 1845 until 1849 but had very disappointing results. Fearful of his additives being leached away he was using a fertilizer too insoluble for the plants to absorb. Once this was corrected, he demonstrated the power of minerals and nitrates in increasing crop yield.

During his visit to England he was shocked to observe the sewage of Britain being sent out to sea. He delivered a tremendous tirade against the British for their practice of importing bones from Europe instead of using their sewage as a fertilizer.

In the field of biochemistry Liebig became involved in a famous dispute with Louis Pasteur. As a supporter of Berzelius, he claimed that all chemical changes were brought about by catalysts and that no organisms were involved. In 1869 he argued that there was nothing biological about fermentation. Pasteur, however, managed to demonstrate that vinegar produced by wine souring on contact with air resulted from the action of yeast. In chemical physiology Liebig showed that animal heat could be entirely accounted for by the oxidation of food. Although he misrepresented the role of protein he pioneered attempts to calculate the calorific values of different foods.

Liebig was remarkable for the wide range of his work. There were greater chemists in the 19th century but none who worked with such authority over such an enormous field.