Tahiliani was commissioned into the Indian Navy on 1 September 1950, and was confirmed as a sub-lieutenant on 17 May 1952. He joined the Indian Naval Air Arm and qualified as a pilot for carrier-based aircraft. He is a graduate of the Naval War College, United States and the National Defence College, New Delhi. He also qualified as a test pilot. Promoted lieutenant-commander on 16 July 1960, he was the first naval pilot to land an aircraft on the deck of, when he landed his Hawker Sea Hawk fighter on 18 May 1961. He served as a carrier-based strike pilot on board INS Vikrant; following his promotion to captain on 31 December 1970, he commanded its carrier borne squadron during the Indo-Pakistan War of 1971. Later, he served as the commanding officer of and INS Vikrant. Promoted to acting rear admiral on 30 December 1977, he was appointed Flag Officer, Goa Area, with promotion to substantive rear admiral on 1 February 1978. Later, he was appointed the Flag Officer CommandingWestern Fleet. His next appointment was as Assistant Chief of the Naval Staff at Naval Headquarters. This was followed by appointment as the Deputy Chief of the Naval Staff. He was promoted to Vice Admiral while in this office. In February 1982, then vice admiral, Tahiliani was appointed the Flag Officer Commanding-in-Chief Southern Naval Command. In March 1983, he was appointed the Flag Officer Commanding-in-Chief Western Naval Command. In May 1984, he was appointed the Vice Chief of the Naval Staff. On 1 December 1984, he took over as the Chief of the Naval Staff of the Indian Navy. Tahiliani retired from the Indian Navy on 30 November 1987.
Tahiliani served as the Governor of Sikkim between 8 February 1990 and 20 September 1994. He helped launch the India chapter of Transparency International as a founder member in 1997. He served as the chairman of the India chapter practically from its founding until 2010 and was chairperson of Balvantray Mehta Vidya Bhawan Anguridevi Shersingh, a senior secondary school located in the South District of New Delhi, India. Tahiliani was elected to the board of Transparency International in 2002.
Personal life
Tahiliani was married to Jaswanti Tahiliani. His wife was the first female engineer in Mumbai. He is the father of noted Indian fashion designer, Tarun Tahiliani, and executive director of Ensemble India, Tina Tahiliani Parikh. He died on 14 October 2015.