Chailly was born in Milan on February 20, 1953. The son of composer Luciano Chailly and a sometime rhythm & blues drummer, Chailly began his conducting career as Claudio Abbado's assistant at La Scala, cutting his teeth on the standard operatic literature. He attained considerable success as an opera conductor in his own right, making guest appearances at London's Covent Garden, the Metropolitan Opera, and numerous Italian and German houses; he also made several notable recordings, including an Andre Chénier with Luciano Pavarotti. Nevertheless, he decided to focus his energies on symphonic conducting instead, feeling that it offered a wider avenue for artistic exploration. To that end, he became the principal conductor of Berlin's Radio Symphony Orchestra in 1982, eventually leading them on their first North American tour in 1985; he was also the principal guest conductor of the London Philharmonic from 1982-1985.
In 1988, the newly rechristened Royal Concertgebouw Orchestra named the 35-year-old Chailly as its chief conductor and artistic director. This would prove to be the defining post of his career, and he would cut back on his touring and operatic engagements to make it the center of his artistic activities. The relationship with both the orchestra and its audience was rocky at first, marked by resentment toward his "modernistic" approach to the works of Bruckner, Mahler, and Brahms. (Among other things, Chailly moved the group away from its signature sound, and toward a more flexible palette of orchestral color, adaptable to the needs of each composer.) However, after that adjustment, Chailly assumed a position of confident leadership over the group, maintaining its position as one of Europe's finest ensembles, but also establishing it as a source of innovation and fresh perspective. Chailly eventually left the Concertgebouw in 2004, where he was replaced by Mariss Jansons.
Chailly is a noted champion of Edgard Varèse and Alexander Zemlinsky, both of whom he feels have been under-appreciated. He also maintains an interest in the performance practice of the Baroque era, and in his performances of Bach's St. Matthew Passion he attempts to balance the sound of the modern orchestra with the style of the period. As an operatic conductor Chailly has made several notable Rossini recordings, including La Cenerentola, starring Cecilia Bartoli. In 2019, Chailly released an album dedicated to Nino Rota's music for films by Federico Fellini, as well as a La Scala production of Puccini's Madame Butterfly, both on the Decca label.