Yanai was born in Ube, a small town in the Southwestern Japanese prefecture of Yamaguchi. His parents owned a tailoring and clothing store, which he lived above, and worked at after graduating with a Bachelor's degree in Economics and Political Science from Waseda University and quitting his job at JUSCO supermarket.

In 1984 he opened his first Uniqlo store, and in 1991 changed the name of his Father’s company from Ogori Shoji to Fast Retailing which was to become the parent company of not only the Uniqlo chain but also J Brand and Theory.

Yanai has ambitions for the company to become the largest retailer in the world. He was also, until late 2019 an independent director of SoftBank Group, a position he held for 18 years.