He was one of the more prominent members of a family celebrated for producing several famous performers and musicians: his brothers Gavri, Ya'akov and Haim are actors, his son Yuval and nephews Ehud, Uri, Me'ir and Eviatar are musicians and singers (some of whom occasionally act), and his niece Orna is an actress and comedian.

He also wrote and directed comic sketches for the comedy trio Hagashash Hachiver, one of whose members was his brother, Gavri.

Some of his revues consisted of renditions of the songs of Jacques Brel and Georges Brassens, which were often translated from French for him by Naomi Shemer.

He was survived by his wife and three sons (one of whom is Yuval Banai, lead singer of one of Israel's most influential pop rock bands Mashina).

In the midst of his twenties, he resigned from the Habima Theatre with the aspiration to be an independent actor not bound by a theatrical framework.

He played in numerous theater productions at the Habima Theatre and most major theaters in the country, in plays such as Tel Aviv Hak'tana (Little Tel Aviv), The Government Inspector, A View from the Bridge, Eddie King, Namer Chabarburot, The Caucasian Chalk Circle, The Task of Life, Cain, Thirst and Hunger, and more.

He frequently acted in the plays of Nisim Aloni, a playwright who greatly influenced him, including The King's Clothes, The Tailors of Jaffa, and The Bride and the Butterfly Hunter.

Artistically, he managed to leave a deep imprint on various creative fields over the years: He is regarded, both by the audience and critics, as a theatrical actor with a dominant stage presence, excelling in dramatic plays (especially in roles of kings and nobility) as well as in comedic performances.

Additionally, Bannai and Naomi Shemer introduced French chansons to Israel, which were not well-known in the country until then.

Ehud Olmert, the Prime Minister at the time, mourned him in a special statement issued by the government following his death, saying, among other things: "Yossi Banai was an exemplar of vast talent in directing, theater, satire, cinema, and singing.

Yossi's unique voice was a central part of the story of the renewed Jewish state in Israel and Jerusalem".