Kehlmann was born in Munich, the son of the television director Michael Kehlmann. He moved to his father's hometown of Vienna at the age of six. At university he read philosophy and literature before doing research for a doctoral thesis on the sublime in the works of Immanuel Kant which he did not finish partly because of his success as a writer.

In 1997 Kehlmann completed his first novel, Beerholms Vorstellung, while still a student. He also wrote numerous reviews and essays while at university, contributing to such organs as: Süddeutsche Zeitung, Frankfurter Rundschau, Frankfurter Allgemeine Zeitung, and Literaturen.

In 2001, Kehlmann held the guest lectureship of poetics at the Johannes Gutenberg University of Mainz. In the winter term of 2005/6 Kehlmann held the lectureship of poetics at the FH Wiesbaden, and in 2006/7 he held the lectureship for poetics at the university of Göttingen. Daniel Kehlmann is a member of the Mainzer Akademie der Wissenschaften und der Literatur.