Born in the port of Veracruz, Veracruz, both he and his younger brother, Sebastián Lerdo de Tejada, became leaders of Mexico's Liberal Party. As the president of the ayuntamiento (city council) of Mexico City in 1852, Miguel Lerdo de Tejada proposed inititiatives on public education, transportation, public health, and budgetary reforms.
As the Treasury Secretary under president Ignacio Comonfort in 1856, Miguel Lerdo de Tejada initiated the Ley de Desamortización de Fincas Rústicas y Urbanas (Disentailment of Rural and Urban Properties Law), commonly known as the Ley Lerdo, which called for the forced sale of most properties held by the Roman Catholic Church and by municipal and state governments. The Church could retain only the buildings it used for its operations (churches, monasteries, seminary buildings); governments could keep only government offices, jails, and school buildings. Other property, which had been used to generate income for the Church and for local governments, was to be sold with the proceeds going into the national treasury. Because of the disruptions of the War of Reform and the French Intervention that wracked Mexico from 1858 to 1867, few properties were actually sold as a direct result of the Ley Lerdo; most of the "disruptions" attributed to that law actually occurred later, under legislation passed during the regime of Porfirio Díaz based on that "Ley" as reference.
Miguel Lerdo de Tejada resigned from his position as Treasury Secretary when Comonfort's successor, Benito Juárez, proposed suspending the payment of Mexico's foreign debt in 1860. He returned to Mexico City with the victorious Liberal government at the conclusion of the War of the Reform on January 1, 1861, and took up his elected post as a member of the Supreme Court, but he died less than three months later, on March 22, 1861.