Kelley was born in Wayne, Michigan, a suburb of Detroit, to a working class Roman Catholic family in October 1954. His father was in charge of maintenance for a public school system; his mother was a cook in the executive dining room at Ford Motor Company. In his early years he was involved with the city’s music scene, which spawned bands such as Iggy and the Stooges, and was a member of the noise band Destroy All Monsters. In 1976, Kelley graduated from the University of Michigan and then moved to Los Angeles. In 1978 he graduated from the California Institute of the Arts with a Master of Fine Arts, where he admired the work of his teachers John Baldessari, Laurie Anderson, David Askevold and Douglas Huebler.

During his time at CalArts, Kelley started to work on a series of projects in which he explored works with loose poetic themes, such as The Sublime, Monkey Island and Plato’s Cave, Rothko’s Chapel, Lincoln’s Profile, using a variety of different media such as drawing, painting, sculpture, performance, video, and writing. In the 1980s he became known for working with another type of material: crocheted blankets, fabric dolls and other rag toys found at thrift stores and yard sales. Perhaps the most famous work in this vein, More Love Hours Than Can Ever Be Repaid from 1987, featured a mess of used rag dolls, animals and blankets strewn across a canvas, a way of investing a fictional childhood scene with some visceral pathos which was first shown at Rosamund Felsen Gallery in Los Angeles. In 1988, Kelley created an installation called Pay for Your Pleasure, which featured a gallery of portraits of men of genius — poets, philosophers and artists included — subverted at the end by a painting created by a convicted criminal. In From My Institution to Yours (1988) and Proposal for the Decoration of an Island of Conference Rooms (1992), Kelly appropriated photocopied drawings and other ephemera of vernacular office humor and moved it into more formalized environments where such crude materials are normally not seen.

Kelley often employed soft, tangled toys as a satirical metaphor for Expressionist art. In Deodorized Central Mass with Satellites (1991–99), an installation sculpture made from untidy clusters of toys suspended from the ceiling, a dozen monochrome plush-toy spheres, linked by a system of cables and pulleys across the ceiling, orbit around a central, rainbow-colored blob; ten large, geometrically faceted, brightly colored wall-reliefs are actually monumental dispensers of pine-scented air freshener, which automatically send their cleansing spray into the room at timed intervals.  In 1995, he produced Educational Complex, an architectural model of the institutions in which he had studied, including his Catholic elementary school and the University of Michigan in Ann Arbor. In 1999, he made a short video in which Superman recites selections from Sylvia Plath’s The Bell Jar.

Kelley was in the band Poetics with fellow California Institute of the Arts students John Miller and Tony Oursler. In 1997–98, Kelley and Oursler presented the Poetics Project at Documenta X, as well as at venues in Los Angeles, New York, and Tokyo; through video projections, sound, and artworks, this installation re-created their experience at CalArts as members of a short-lived band. Along with his collaborations with Shaw and Oursler, Kelley was also known for working with artist Paul McCarthy in the 1990s. They collaborated on a series of video projects, including a 1992 work based on Johanna Spyri’s classic children’s book, “Heidi”. A 1986 Massachusetts Institute of Technology presentation of Kelley’s performance Plato’s Cave, Rothko’s Chapel, Lincoln’s Profile (1985) included a live performance by Sonic Youth; the band later featured his orange-knit creatures on the cover and booklet of their 1992 record Dirty. In 2010, he combined with Artangel to realize his first work of public art in Detroit.

In November 2005, Kelley staged Day is Done, filling Gagosian Gallery with funhouse-like multimedia installations, including automated furniture, as well as films of dream-like ceremonies inspired by high school year book photos of pageants, sports matches and theater productions. In December 2005, Village Voice art critic Jerry Saltz described “Day is Done” as a pioneering example of “clusterfuck aesthetics,” the tendency towards overloaded multimedia environments in contemporary art. “Day is Done” was Kelley ‘Gesamtkustwerk”, this body of work was initiated with ‘Extracurricular Activity Projective Reconstruction #1 (Domestic Scene), the work was produced by Emi Fontana and first exhibited in her gallery in Milano in 2000. In the same year Emi Fontana and Mike Kelley started a romantic relation that lasted for seven years and made Fontana relocating in Los Angeles.

Begun in 1999, the Kandor project (2007) deals with the town of Kandor, on the planet Krypton from which the child Kal-El escaped to Earth, where he became Superman. Kandor’s depiction in these narratives is inconsistent and fragmentary, prompting Kelley to create multiple versions of it, cast in colorful resins and illuminated like reliquaries. The installation Kandor-Con 2000 was first presented in the millennium show at Kunstmuseum Bonn and later at the Technical University Berlin (2007), the Deichtorhallen/Sammlung Falckenberg, Hamburg (2007); ZKM, Karlsruhe (2008); the Shanghai Biennial (2008); and the Centre Pompidou, Paris (2010). Kandor-Con 2000 is conceived – and continued to develop – as a work in progress. Throughout the exhibitions, architecture students built cardboard models of Kandor inspired by the original comics. These models were sent to Pasadena, where Kelley made scaled down casts. Kandor 10A (2010), a yellow city housed in a hand-blown, pink glass bottle, is a grouping of tall skyscrapers situated within a full-scale rock grotto. Kandor 10B (Exploded Fortress of Solitude) (2011) is a pile of dark boulders and slabs forming a cave with a quarry-like foyer made from faux black rock and built on a scale that invites the viewer into the forbidden fortress. Set within the cave’s inner recesses is a glowing rose-colored city-in-a-bottle. Kandor 12, constructed in off-white resin and evocative of a group of chess pawns, or minarets, is encased in a shadowy brown bottle, which sits on a platform resembling a Greek column positioned in front of a chest of drawers and an illuminated translucent green wall.

In 2009 Kelley collaborated with long time friend and fellow artist Michael Smith on “A Voyage of Growth and Discovery”, a six-channel video and sculptural installation piece. This piece was conceived in 2007 and curated by Emi Fontana, produced by Kelley himself and West of Rome Public Art. The work was first installed at the Sculpture Center, New York in 2009, The Farley Building (former Kelley studio) for West of Rome in 2010, and The BALTIC Center for Contemporary Art in 2011.  The artist’s last performance video was Vice Anglais from 2011.  Kelley’s work was inspired by diverse sources such as philosophy, politics, history, underground music, decorative arts and working-class artistic expression. His art often examined class and gender issues as well as issues of normality, criminality and perversion.  Kelley lived and worked in various places in Los Angeles, among them the Farley Building in Eagle Rock.

In 2012, Kelley was found dead of an apparent suicide in South Pasadena. A spontaneous memorial to Kelley was built in an abandoned carport near his studio in the Highland Park section of L.A. shortly after news of his death. Mourners were invited via an anonymous Facebook page to “help rebuild MORE LOVE HOURS THAN CAN EVER BE REPAID AND THE WAGES OF SIN (1987), by contributing stuffed fabric toys, afghans, dried corn, wax candles…building an altar of unabashed sentimentality.” The memorial was active throughout February 2012 and was dismantled in early March 2012, with the contents given to the Mike Kelley Foundation.