Born in London, England, Ricardo was the third of 17 children of a Sephardic Jewish family of Portuguese origin who had recently relocated from the Dutch Republic. His father was a successful stockbroker.

At age 21, Ricardo eloped with a Quaker, Priscilla Anne Wilkinson, leading to estrangement from his family. His father disowned him and his mother apparently never spoke to him again.

Without family support, he started his own business as a stockbroker, in which he became quite successful thanks to the connections he made when working with his father.

During the Battle of Waterloo, by using insider information and by profiting from the false market panic he helped create, he made a fortune by betting against the French victory and invested in British securities. Subsequently, at the age of 43, he retired from the Exchange. His fortune was estimated at about £600,000. He then purchased and moved to Gatcombe Park, an estate in Gloucestershire, now owned and lived in by Princess Anne, the Princess Royal. he was appointed High Sheriff of Gloucestershire for 1818–19.[5]

At the time of his marriage, Ricardo disconnected from Judaism and became a Unitarian.[6] He was one of the original members of The Geological Society.[6] His sister was Sarah Ricardo-Porter, who married George R. Porter and was an author in her own right (e.g., Conversations in Arithmetic).

Ricardo became interested in economics after reading Adam Smith's The Wealth of Nations in 1799 on a vacation to the English resort of Bath. This was