Prakash Jha was raised at his family's farm in Baraharwa, Bettiah, West Champaran, Bihar, India. He did his schooling from Sainik School Tilaya, Koderma district and Kendriya Vidyalaya No. 1, Bokaro Steel City (Jharkhand). Later, he joined Ramjas College, Delhi University to do B.Sc (Hons) in Physics; though he left studies after one year, and decided to go to Mumbai and become a painter, though while he was preparing for J.J. School of Arts, he happened to witness the shooting of the film Dharma and got hooked on to filmmaking.
Soon he joined the Film and Television Institute of India (FTII), Pune in 1973, to do a course in editing, though midway through it, the institution was closed for while, due to student agitation, so he came to Mumbai, and started working, and never went back to complete the course.