Paul Bailey attended Sir Walter St John's Grammar School For Boys in Battersea, London. He won a scholarship to the Central School of Speech and Drama in 1953 and worked as an actor between 1956 and 1964. He became a freelance writer in 1967.
He was appointed Literary Fellow at Newcastle and Durham Universities (1972–74), and was awarded a Bicentennial Fellowship in 1976, enabling him to travel to the USA, where he was Visiting Lecturer in English Literature at the North Dakota State University (1977–79). He was awarded the E. M. Forster Award in 1974 and in 1978 he won the George Orwell Prize for his essay "The Limitations of Despair", first published in The Listener magazine. Bailey was elected a Fellow of the Royal Society of Literature in 1999.
Paul Bailey's novels include At The Jerusalem (1967), which is set in an old people's home, and which won a Somerset Maugham Award and an Arts Council Writers' Award; Peter Smart's Confessions (1977) and Gabriel's Lament (1986), both shortlisted for the Booker Prize for Fiction; and Sugar Cane (1993), a sequel to Gabriel's Lament. Kitty and Virgil (1998) is the story of the relationship between an Englishwoman and an exiled Romanian poet. In Uncle Rudolf (2002), the narrator looks back on his colourful life and his rescue as a young boy from a likely death in fascist Romania, by his uncle, a gifted lyric tenor and the novel's eponymous hero. His latest book is "Chapman's Odyssey" (2011), in which the main character, Harry Chapman, in morphine-induced delirium, encounters characters from literature, writers, deceased friends and family members as he lies seriously ill in a London hospital. Despite his melancholy and fear, Harry entertains the nurses with recitations of some of the favourite poems he has memorised in a lifetime of reading.
Bailey has also written plays for radio and television: At Cousin Henry's was broadcast in 1964 and his adaptation of Joe Ackerley's We Think the World of You was televised in 1980. His non-fiction books include a volume of memoir, entitled An Immaculate Mistake: Scenes from Childhood and Beyond (1990), and Three Queer Lives: An Alternative Biography of Naomi Jacob, Fred Barnes and Arthur Marshall (2001), a biography of three gay popular entertainers from the twentieth century.
- At The Jerusalem (1967) – winner of the Author's Club First Novel Award
- Trespasses (1970)
- A Distant Likeness (1973)
- Peter Smart's Confessions (1977)
- Old Soldiers (1980)
- An English Madam: The Life and Work of Cynthia Payne (1982)
- Gabriel's Lament (1986)
- An Immaculate Mistake: Scenes from Childhood and Beyond (1990)
- Sugar Cane (1993)
- The Oxford Book of London (ed., 1995)
- First Love (ed., 1997)
- Kitty and Virgil (1998)
- The Stately Homo: A Celebration of the Life of Quentin Crisp (ed., 2000)
- Three Queer Lives: An Alternative Biography of Naomi Jacob, Fred Barnes and Arthur Marshall (2001)
- Uncle Rudolf (2002)
- A Dog's Life (2003)
- Chapman's Odyssey (2011)
- McCrum, Robert (2010) "Last year was sheer hell for the novelist Paul Bailey. Better times may be here", The Observer, 7 March 2010, retrieved 2011-07-04
- Taylor, Alan (1986) "Six Authors Brought to Booker", Glasgow Herald, 27 September 1986, p. 10, retrieved 2011-07-04
- Miller, Keith (2011) "Chapman's Odyssey by Paul Bailey: review", Daily Telegraph, 14 January 2011, retrieved 2011-07-04
- Canning, Richard (2001) "Three Queer lives by Paul Bailey: Happy campers", The Independent, 3 November 2001, retrieved 2011-07-04
- Ezard, John (2001) "Out of the 'gum tree and wombat culture'", The Guardian, 6 June 2001, retrieved 2011-07-04