Jaini was born to a Digambar Jain family residing in Nellikar, a small town near Moodabidri, Karnataka, India. His father had abandoned his title of Shetty and adopted the name of Jaini—after the famous Jain scholar, Jugmandar Lal Jaini —responding to calls within the community to change their names to foster a greater sense of Jain identity. After completing his elementary education, he was sent to Digambara Jain Gurukul, a boarding school in Karanja in Vidharbha, Maharashtra. It was run on traditional Jain principles and here he came in contact with Jain scholars of his time like – Pandit Nathuram Premi, Dr. Hiralal Jain, Dr. A.N. Upadhye. After completing his secondary education here, he went to Arts College at Nashik where he took the degree of BA hons in 1947 in Sanskrit and Prakrit. During this time he supported himself by taking a job as a superintendent of a Jain Svetambara Hostel and thus coming in contact with the Svetambara community for the first time.
Path to scholarship
After graduation, he was invited to study with Pandit Sukhlal Sanghavi, a renowned scholar belonging to the Sthanakvasi Jain tradition. His daily meeting with Sanghavi, involved not only a formal and rigorous instruction in Jain logic, but he was also exposed to Sanghavi's views on various sectarian debates and controversies. With Sukhlalji's encouragement he studied Pali canon and decided to continue his postgraduate studies in Sri Lanka, thus acquiring a thorough knowledge of Pali Canon and Buddhist scriptures. Here he became a Dharmananda Kosambi memorial Scholar and met Dr. B. R. Ambedkar and was awarded Tripatakacarya degree in 1951 at the residence of the Prime Minister Senanayake. His years in Sri Lanka were the basis for his first publication in Gujarati, "Ceylonman Be Varsa". It contains much information on the Theravada Buddhism philosophy and practices. On returning he took up position as a lecturer in Ahmedabad and in 1952 he took up position as a lecturer in Pali in Benaras university. Subsequently he took up position as a lecturer in Pali and Sanskrit with SOAS, London from 1956 to 1957. There under John Borough's supervision he completed his Ph.D. in Buddhist work, Abhidharmadipa. From there he travelled to Burma, Indonesia, Cambodia and Thailand to collect various Buddhist manuscripts which he later edited and translated for Pali Text Society. Subsequently he moved to University of Michigan as professor of Indic Languages and Literature up to 1972..Thereafter from 1972 to 1994 he served as a professor of Buddhist studies in Department of South and Southeast Asian studies, University of Berkeley, California. After his retirement, he has continued as Professor Emeritus of the University. The University has constituted "Padmanabh S. Jaini Graduate Student Award in Buddhist Studies" that supports high-achieving graduate students in Buddhist Studies at UC Berkeley and honors Professor Jaini's important legacy in the field of Buddhist studies.