An over-aged student who was accepted only after extensive appeals, Zhang graduated from the Beijing Film Academy in 1982 along with compatriots Chen Kaige and Tian Zhuangzhuang. He then began working as a cinematographer for the Guangxi Film Studio. Zhang's first work, One and Eight (as director of photography), was made in 1984. Zhang then collaborated with Chen Kaige, the latter acting as director, to photograph one of the defining Chinese films of the 1980s, Yellow Earth (1984), later to be considered the inauguration film for the Chinese Fifth-Generation directors. Zhang continued to work with Chen for the latter's next film, The Big Parade (1985).

In 1985, Fourth Generation director Wu Tianming invited Zhang to Xi'an Film Studio, where the former was head, for his upcoming project Old Well. In return Zhang made Wu promised logistics support for his first directorial effort. Upon completion of the filming of Old Well as cinematographer and actor - winning Zhang the Tokyo International Film Festival's Best Actor - Zhang embarked on his directorial debut Red Sorghum. Red Sorghum (1987) catapulted Zhang into the forefront of the world's art directors, winning him critical praise and the Berlin Golden Bear. Its rich visual style of narrative storytelling came to be the hallmark of Zhang's early films. Judou (1989) and Raise the Red Lantern (1991) (both sponsored with foreign funds), which depict highly intense scenes through controlled, formalized color photography, were both nominees for Best Foreign Language Film at the Academy Awards.

The Story of Qiuju (1992) marked a significant change in direction for Zhang. Far less unrelenting with scenes of everyday humor, Zhang used non-professional actors together with his long-time collaborator Gong Li to achieve a neorealist effect in telling a tale of Chinese peasantry waddling through ineffective bureaucracy. Upon completing this film, Zhang then made To Live (1994; Cannes Best Actor for Ge You), a film based on the acclaimed novel by Yu Hua, which is an epic framework about the resilience of the ordinary Chinese folks, personified by its two leads, amidst three generations of historical upheavals throughout the 20th century. Zhang completed this phase with the gangster film Shanghai Triad (1995).

Most of Zhang's films up to the mid-nineties featured the Chinese actress Gong Li. Gong and Zhang's romantic relationship ended during production of Shanghai Triad; the two have not collaborated since finishing that film. His next film, The Road Home (1999, featuring Zhang Ziyi in her film debut), is a simple throw-back narrative centering around a love story between an unidentified narrator's parents. As in The Story of Qiuju, Zhang returned to the neorealist habit of employing non-professional actors and location shooting, taking it further by sometimes even retaining the original names of actors in the script, for the highly effective companion piece in Not One Less (1999).

Zhang's succeeding major project was the ambitious wuxia drama Hero (2002), which follows after his second film in a series about modern Chinese city-life, Happy Times (2000). Hero was released in North America two years after its Chinese release and became one of the few foreign-language films to top the U.S. box office. It was followed by another martial arts epic, House of Flying Daggers (2004), which was a more modest international success.

One of Zhang's recurrent themes is a celebration of the resilience, even the stubbornness, of Chinese people in face of hardships and adversities, a theme which has occurred from To Live (1994) through to Not One Less (1999). His works are particularly noted for its sensitivity to color, as can be seen in his early trilogy (like Raise the Red Lantern) or in his wuxia films, Hero and House of Flying Daggers.

Zhang Yimou has also directed an acclaimed version of the music opera, Puccini's Turandot, at the Forbidden City, Beijing, with Zubin Mehta as conductor.