James Watt was born in Greenock, Renfrewshire, on 19 January 1736. His father, also called James Watt (1698-1782) was a shipwright, shop owner and contractor, while his mother Agnes Muirhead came from a distinguished family and was well-educated. Watt attended school irregularly and instead was mostly schooled at home by his mother, displaying a real aptitude for mathematics.

In 1753, at the age of seventeen, Watt’s mother died and his father’s heath began to fail. Watt travelled to London to study instrument-making, before returning to Scotland the following year, intent on setting up his own instrument-making business in Glasgow. However, as he had not served at least seven years as an apprentice, the Glasgow Guild of Hammermen blocked his application. The University of Glasgow instead offered Watt the opportunity to set up a workshop within the university. Watt established his workshop in 1757 and one of the university professors, the physicist and chemist Joseph Black, became Watt’s friend and mentor.

In 1761 Watt began to experiment with steam and read everything about it he could. In 1763 Watt repaired Glasgow university’s model Newcomen Engine, discovering it was highlight inefficient as about 80% of the heat of the steam was consumed in heating the cylinder, because the steam in it was condensed by an injected steam of cold water. By 1765 Watt had developed a working model which bypassed this issue with his Separate Condenser, in which steam condensed in a separate chamber apart from the piston, which meant that the temperature of the cylinder was kept at the same temperature as the injected steam.

Watt then spent a number of years working to both obtain a patent for this process and to produce a full-scale engine. In 1774 he moved to Birmingham, and in 1776 entered into a hugely successful partnership with Matthew Boulton, whose factory ownership finally gave Watt the access to the skilled iron workers that he needed. In 1776, the first engines were installed and working in commercial enterprises. These first engines were used for pumps and produced only reciprocating motion. Orders began to increase and for the next five years Watt was busy installing more engines, mostly in Cornwall for pumping water out of mines.

Over the next six years Watt made a number of other improvements and modifications to the steam engine. A double acting engine, in which the steam acted alternately on the two sides of the piston was one. A throttle valve to control the power of the engine, and a centrifugal governor to keep it from "running away" were very important. He described methods for working the steam expansively. A Compound Engine, which connected two or more engines was described. Two more patents were granted for these in 1781 and 1782. Numerous other improvements that made for easier manufacture and installation were continually implemented. One of these included the use of the steam indicator which produced an informative plot of the pressure in the cylinder against its volume, which he kept as a trade secret. Another important invention, one of which Watt was most proud of, was the three-bar linkage which produced the straight line motion required for the cylinder rod and pump, from the connected rocking beam, whose end moves in a circular arc. This was patented in 1784. These improvements taken together produced an engine which was about five times as efficient in its use of fuel as the Newcomen engine.

1794 he and Boulton established Boulton and Watt, which exclusively manufacture steam engines, and this became a large enterprise. By 1824 it had produced 1,164 steam engines having a total nominal horsepower of about 26,000. Boulton proved to be an excellent businessman, and both men eventually made fortunes.

Watt’s improvements turned the Newcomen Engine into a source of power which transformed working practices, and was the key innovation that brought forth the Industrial Revolution. A key feature of it was that it brought the engine out of the remote coal fields into factories and also made possible the construction of new factories that, since they were not dependent on water power, could work the year round, and could be placed almost anywhere. Work was moved out of the cottages, resulting in economies of scale. Capital could work more efficiently, and manufacturing productivity greatly improved. It was also the starting point for a new generation of more powerful machines, including Watt’s own steam engine.

In 1800 Watt retired at the age of 64, with partnership of Boulton and Watt transferring to Boulton’s son Matthew Boulton and Watt’s son James Watt (Junior). William Murdoch also became a partner in the firm and it prospered.

Watt continued to invent other things before and during his retirement. These included a new method of measuring distances by telescope, a device for copying letters, improvements in the oil lamp, a steam mangle and a machine for copying sculptures. He was a fellow of the Royal Society of Edinburgh and the Royal Society of London, a member of the Batavian Society, and one of only eight Foreign Associates of the French Academy of Sciences. During his retirement Watt and his wife travelled to France and Germany, and he purchased an estate in Wales, which he much improved. Watt died on 25 August 1819 at his home in Handsworth, Birmingham.