Nick Drake was born June 19, 1948 in Rangoon, the capital of the Southeast Asian nation of Myanmar (then known as Burma), to Rodney and Molly Drake. Drake's father worked as a medical doctor. Drake was brought up in Tanworth-in-Arden, a small village in the English county of Warwickshire. He went to public school at Marlborough College, where he learned to play the flute. As a young adult, Drake enrolled in Fitzwilliam College in Cambridge to study English literature. His older sister, Gabrielle Drake, is an actress.

Drake was a fan of British folk music and the emerging American folk music scene, including Bob Dylan and Phil Ochs. While a college student, Drake began performing in local clubs and coffee houses. He was discovered by Ashley Hutchings, the bass player of the folk rock supergroup Fairport Convention. Hutchings introduced Drake to the other members of Fairport Convention, folk singer John Martyn and producer Joe Boyd.

Drake’s associates convinced Island Records to sign the young singer/songwriter to a three-album contract. At the age of twenty, he released his first album Five Leaves Left (1969), which featured a chamber music quartet on several songs and had a light, dour sound. Drake’s second album Bryter Layter (1970) introduced a more upbeat, jazzier sound, with keyboards and several brass instruments. Both albums were produced by Boyd and featured several members of Fairport Convention.

Drake was pathologically shy and resented touring. The few concerts he did play were usually in support of other British folk acts of the time, such as Fairport Convention or John Martyn and were often brief and awkward. Partially because of this, his work received little attention and sold poorly.

Severely clinically depressed and doubting his abilities as a musician, Drake recorded his final album Pink Moon (1972) in two two-hour sessions, both starting at midnight. The songs of Pink Moon were short (the album consists of eleven of them and lasts only 26 minutes) and emotionally bleak and Drake recorded them unaccompanied, in the presence of only a sound engineer (a piano was later overdubbed on the title track). Naked and sincere, it is widely thought to be his best work. After recording the album, Drake dropped off the master tapes at the front desk of Island Records' office building and then swore he was retiring from performing music, planning to train to be a computer programmer and possibly write songs for others to perform.

However, none of Drake’s plans materialized. In the next few months, Drake grew severely depressed and maintained relationships only with close friends such as John Martyn, who wrote the title song of his 1973 album Solid Air for and about Drake, and French singer Françoise Hardy. He was hospitalized several times and lived with Hardy for a few months.

In 1974, Drake felt well enough to write and record a few new songs. However, on November 24, he died of an overdose of antidepressants. The coroner concluded that the cause of Drake’s death was suicide, although this was disputed by friends and relatives. Antidepressants of that time were quite lethal if ingested in any higher dosage than the one prescribed.

Since Drake’s death, his music has grown steadily in popularity. Several contemporary musicians, such as Lucinda Williams, Elliott Smith, Badly Drawn Boy, Matthew Good, Sebadoh's Lou Barlow, REM guitarist Peter Buck and Blur’s Graham Coxon, consider Drake an important influence.

Island Records has responded to Drake’s popularity with several new releases including "Time of No Reply" (1986), an album of unreleased material including four new songs recorded in 1974, "Way to Blue" (1994), a "best of" album, and "Made to Love Magic" (2004), featuring one new track and some newly recorded orchestration for a previously released track.