Mukhtarov was born into a poor family in a village of Amirajan near Baku. Mukhtarov managed to become one of the most reputable drilling experts in Baku through his ability and many years of experience. He set up his own drilling company in 1890 and then diversified into oil production. The company specialized in manufacturing machinery for derricks and in drilling oil wells. He was the author of several patents on drilling equipment - unique feat amongst oil industrialists of the time.
Business and enterprising millionaire built for himself magnificent mansion, which is now Wedding Palace in Baku. Another interesting fact from his life: with his wife they funded young singer Fatma Mukhtarova who would later go on to become a star of the Baku opera stage.
Mukhtarov sponsored schools and build mosques in Baku and surrounding areas. His fanciful Gothic Revival residence built for his wife Liza Mukhtarova by architect Józef Plośko in 1911-1912 is a celebrated example of the Baku oil boom architecture.