His father Liao Zhubin, who had five wives, was sent to San Francisco by the Hong Kong and Shanghai Bank.

In the early struggles of the party, Liao Zhongkai was arrested by Guangdong strongman Chen Jiongming in June 1922.

When Sun Yat-sen died in Beijing in March, 1925, and Liao was one of the three most powerful figures in the Kuomintang Executive Committee, the other two were Wang Jingwei and Hu Hanmin.

Liao continued his belief in Sun's policy after Sun died, including one of the key policies of maintaining close relations with the Soviet Union as well as the Chinese Communist Party, which was strongly opposed by the KMT right wing.

Liao was assassinated before a Kuomintang Executive Committee meeting on August 20, 1925, in Guangzhou, when five gunmen riddled him with bullets from Mauser C96s as he stepped out of his limousine.