Peter Morrissey was born in 1962 and grew up in Sydney's Sutherland Shire, one of six children including a twin sister. He was educated at Our Lady of Fatima, Caringbah, and De La Salle College, Cronulla.

Active in Australian fashion since the 1980s, he spent fourteen years in partnership with Leona Edmiston on the Morrissey Edmiston label, one of the defining Sydney names of its time. The partnership ended in 1997, and Morrissey founded the eponymous Morrissey label the same year, with the financier René Rivkin taking a 60 per cent stake. The label flourished; it was sold to the Oroton Group in 2000 and to M Webster Holdings in 2006, which closed it in February 2009 during the downturn. Morrissey reacquired the businesses and trademarks associated with his name in 2011. In 1996 he had been among the designers who helped launch Australian Fashion Week.

His public commissions are among the most widely seen work in Australian design. For the Sydney 2000 Olympic opening ceremony he designed costumes for the Oceania performers in the "Arrivals" segment. In 2003 Qantas engaged him to design its uniforms, featuring the Wirriyarra print by the Indigenous-owned agency Balarinji; they were worn until 2013, and he also designed the airline's business-class pyjamas from 2007 to 2016. He has designed uniforms for McDonald's, Novotel and OPSM, and in 2025 for Salesian College in Melbourne. When Martin Grant's Qantas uniform replaced his in 2014, it continued a lineage of airline designers that runs from Emilio Pucci and Yves Saint Laurent through George Gross and Harry Who to Morrissey's own 2003 design.

GQ Australia named him Designer of the Year in 2002, FHM did the same in 2003 and 2004, and Cleo named him its Designer of the Year in 2004.

Since 2009 he has worked in the mass market, first with a fashion range for Big W developed with Bruno Schiavi, and from 2013 with the Home by Peter Morrissey homewares range. He was a judge on the fourth season of Project Runway Australia in 2012.

The years after 2008 tested him. When he tried to register his own name for a new budget range, M Webster Holdings, then owner of the Morrissey brand, successfully opposed it, and in June 2009 he suffered a cerebral aneurysm that he was given little chance of surviving without lasting damage. After four months in hospital he dropped his appeal, sold his Darlinghurst apartment and used the proceeds to buy back the trademark. He has described himself as "a dag from Caringbah who grew up with five siblings in a fibro home", and defended his move to Big W in those terms. "I didn't go over to Big W to make cheap clothes," he told the Sydney Morning Herald in 2013. "I went there to make appropriately priced clothes because people are suffering." His $130 suit sold 3,000 units in its first week, he said, "more than I used to sell in an entire year". He mentors young designers with the same pragmatism, urging them to make clothes in the knowledge that each piece "has a life to live".

Morrissey also served as an early employer of talent: Jayson Brunsdon was creative director of his label before founding his own.