Hensher was born in South London, although he spent the majority of his childhood and adolescence in Sheffield, attending Tapton School. He did his undergraduate degree at Lady Margaret Hall, Oxford, before attending Cambridge, where he was awarded a PhD for work on 18th century painting and satire. Early in his career he worked as a clerk in the House of Commons, from which he was fired over the content of an interview he gave to a gay magazine. He has published a number of novels, and is a regular contributor, columnist and book reviewer for newspapers and weeklies such as The Guardian, The Spectator, The Mail on Sunday and The Independent.
The Bedroom of the Mister’s Wife (1999) brings together 14 of his stories, including "Dead Languages", which A. S. Byatt selected for her Oxford Book of English Short Stories (1998), making Hensher the youngest author included in the anthology. 
He is Professor of Creative Writing at the University of Bath Spa. From 2005 to 2012 he taught creative writing at the University of Exeter. He has edited new editions of numerous classic works of English Literature, such as those by Charles Dickens and Nancy Mitford, and Hensher served as a judge for the Booker Prize.
In 2008, Hensher's semi-autobiographical novel The Northern Clemency was shortlisted for the Man Booker Prize. In 2012, Hensher won first prize in the German Travel Writers Award, and is shortlisted for the Green Carnation Prize. He also won the Stonewall Prize for the Journalist of the Year in 2007 and the Somerset Maugham Award for his novel Kitchen Venom in 1996. In 2013, his novel "Scenes from Early Life" was shortlisted for the Green Carnation Prize, and awarded the Ondaatje Prize. It is based on his husband's childhood against the backdrop of the war of independence in Bangladesh He wrote the libretto for Thomas Adès' 1995 opera Powder Her Face.
His early writings have been characterized as having an "ironic, knowing distance from their characters" and "icily precise skewerings of pretension and hypocrisy". His historical novel The Mulberry Empire "echos with the rhythm and language of folk tales" while "play[ing] games" with narrative forms.
He is married to Zaved Mahmood, a human rights lawyer at the United Nations.
Among Hensher's novels are:
- Other Lulus (1994)
- Kitchen Venom (1996)
- Pleasured (1998)
- The Mulberry Empire (2002) Flamingo/Harper Perennial
- The Fit (2004) 4th Estate/Harper Perennial
- The Northern Clemency (2008) Harper Collins/4th Estate.Shortlisted for Booker Prize.
- King of the Badgers (31 March 2011) 4th Estate ISBN 978-0-00-730133-1
- Scenes from Early Life (12 April 2012) 4th Estate ISBN 978-0007433704. Winner of the Royal Society of Literature's Ondaatje prize (2013)
He has also published a short story collection:
- The Bedroom of the Mister's Wife (1999)
- Selected Essays (2006)
- The Missing Ink: The Lost Art of Handwriting (2012)
- Contemporary British Novelists Nick Rennison p. 65
- Memorandum from Dr Philip Hensher, FRSL, to the House of Commons Select Committee on Education and Employment, October 1998
- The Independent many times. (July 2, 2006), Gay Power: The pink list. Retrieved June 25, 2007.
- Hensher's staff pages at the University of Exeter
- Mostly Fiction interview with Philip Hensher, author of The Northern Clemency