Muspratt, the son of a cork-cutter, was born and educated in Dublin before being apprenticed to a druggist. He developed an early interest in chemistry but before going into business he led an adventurous life and fought in Spain in the Peninsular War in both the army and the navy. He returned to Dublin in 1814 where, with the help of a small inheritance received in 1818, he manufactured various chemicals in a small way.

Muspratt moved to Liverpool, where he produced sulfuric acid, in 1822 and was quick to see the importance of the abolition in 1823 of the £30 per ton duty on salt. Cheap salt and the Leblanc process meant that a plentiful supply of soda could be produced for the large demands of the soap, glass, and dyeing industries. With this financial incentive Muspratt set up on Merseyside the third soda plant in Britain. Close to both the salt mines of Cheshire and the textile industry of Lancashire, he was ideally situated. The need for expansion drove him into partnership with Josias Gamble and they founded the alkali industry in St. Helens (1828), but two years later he moved to Newton-le-Willows on his own. (The area close to his original works is still known in the town as ‘Vitriol Square’.)

One of the major problems of the Leblanc process was its production of quantities of hydrochloric acid gas as a waste product. This pollution raised protests, such as the letters appearing in a Liverpool paper in 1827 lamenting that the local church could not be seen from a distance of 100 yards (91 m) and was rapidly turning a dark color. The move to St. Helens only delayed the inevitable prosecutions. Muspratt was unwilling to use William Gossage's tower and following litigation (1832–50) he was eventually successfully prosecuted by the neighboring farmers whose land was being destroyed. For this reason he moved his factories to Widnes and Flint in 1850. Following his retirement in 1857 they were run by his sons until in 1890 they became part of the United Alkali Company.