His father, Xu Yuwen, was a general officer in the War of Resistance against Japan, serving as a surgeon and the director of the Rear Hospital.

In 1957, he left for Changchun City in Jilin Province to study at the High School Affiliated to Northeast Normal University, together with his eldest sister.

In 1963, after finishing high school with an outstanding performance, Xu decided not to apply for college because of his dissatisfaction towards the Chinese higher education system and its teaching methods.

Determined to be an independent thinker and learner, Xu self-taught himself philosophy, political science, history, world literature, and supported himself on several study trips to the Chinese countryside from 1963 to 1964.

As a key organizer and active participant, Xu played an instrumental role in the Chinese Democracy Wall movement of the late 1970s.

Under Xu's leadership, the April Fifth Forum became the longest-lasting civilian-run publication of the Democracy Wall Movement, publishing a total of 17 issues between November 1978 and January 1980.

In establishing a political opposition party, Xu met and had discussions with Wang Xizhe, Sun Weibang, and Liu Er’an, at Ganjiakou, Beijing, China, from 10–12 June 1980.

On 9 November 1998, Xu, together with Zha Jianguo, Gao Hongming, He Depu, and Liu Shizun, established the Beijing and Tianjin branches of the China Democracy Party.

9 March 2005: Reiterated his political program: "To abandon one-party dictatorship, lay aside the issue of Taiwanese independence, restore a democratic China, and build an equal and prosperous federation."

25 September 2009: Launched the signing of the "Peace Agreement", a public letter to leaders across the Taiwan Strait, aiming to build a constitutional democratic China based on "The Three Haves of Citizens".

"[citation needed] 6 June 2011: Re-elected as the chairman of the National Joint Headquarters of the China Democracy Party at its Second Overseas Representatives Assembly.