Bhagyaraj was born on 7 January 1953 in Vellankoil near Gobichettipalayam in Erode district in a Telugu Kamma family in Tamil Nadu.

He made his directorial début with Suvarilladha Chiththirangal in 1979 and also his debut as the leading man in Puthiya Vaarpugal, directed by Bharathiraja.

He quickly established his own concern and started producing a string of distinctive films made mainly in the Tamil language.

Bhagyaraj often cast himself in the lead roles of the films he scripted and directed, effectively carving out a niche for himself in the actor-auteur vein.

He became nationally famous when he wrote the script for Mundhanai Mudichu remade in Hindi as Masterji with Rajesh Khanna in the lead role, which was huge success at the box office.

He rarely acted in films not directed or written by him, with exceptions being Anbulla Rajinikanth (1984) and Naan Sigappu Manithan (1985).

In 1988, he wrote the script for Idhu Namma Aalu and decided to produce it, but chose not to direct it by himself, as he wanted to act-write-direct a film on a serious issue, which was Aararo Aaariraro.

From 1991, he gradually started accepting more acting offers as a lead hero, where director-producer-scriptwriter would be three different people, rather than he himself writing-directing-acting in his films.

He cast his son Shanthanu Bhagyaraj as the child artist in Vaettiya Madichu Kattu in 1998 and the film dealt with the father-son relationship, this proved to be both a critical and financial disappointment capping an end to a string of continuous flops including Oru Oorla oru Rajakumari, Gnanapazham and Mr. Bechara (1996).

[12] He took a break from acting as the lead hero in Tamil films after the release of the massive critical and commercial failure Vaettiya Madichu Kattu.

[13][14] He wrote books such as Vaanga Cinemavai Pattri Pesalam, Neenga Nenaicha Saadikkalaam and Ungal Bhagyaraj in Kelvi Bhadhil (Five Parts).

[22] On April 5, 2006, Bhagyaraj joined the DMK in the presence of party president M Karunanidhi, and he criticised AIADMK general secretary J Jayalalithaa.

[24] While speaking to the media at a press event for the film Karuthukalai Pathivu Sei in 2019, Bhagyaraj remarked that women invite males to sexually assault them and provide them the room to do so.