She was the third daughter and fifth child of Frederick William II of Prussia and Frederika Louisa of Hesse-Darmstadt.

Augusta was in Berlin with her children at the time, having remained in the Prussian capital due to her pregnancy when Napoleon's army took it for France.

With Hesse and Prussia occupied and her family in exile, Augusta lacked money, and after her child's birth she asked for a meeting with Napoleon.

Augusta lived in Schoenfeld Palace, where she became a celebrated salonist and the centre of the romantic Schoenfelder-circle, which included Ludwig Hassenpflug, Joseph von Radowitz and the Grimm brothers, while William lived in a different residence with his mistress, Emilie Ortlöpp.

Several months after Augusta's death, William morganatically remarried his longtime mistress Emilie Ortlöpp, ennobled as Countess von Reichenbach-Lessonitz, by whom he had an additional eight children.