He was born in Usingen, the eldest son of Prince Charles of Nassau-Usingen and his wife, Christina Wilhelmina, the daughter of Duke John William III of Saxe-Eisenach.

In 1783, he concluded a treaty of inheritance with the princes of Nassau-Saarbrücken, Nassau-Weilburg and Nassau-Dietz (i.e., Orange-Nassau), in which it was agreed that the Nassau lands were indivisible and that mutual succession among the various branches based on primogeniture would be observed.

In 1797, Prince Henry Louis of Nassau-Saarbrücken died childless and Charles William inherited his principality.

However, under the Treaty of Lunéville, the territories on the left bank of the Rhine were lost to France.

Charles William married Countess Caroline Felizitas of Leiningen-Dagsburg, the daughter of Christian Karl Reinhard of Leiningen-Dagsburg-Falkenburg-Heidesheim.