Phetsarath was born on 19 January 1890 in Louang Phrabang, the second son of Oupahat Bounkhong and his second wife, Princess Thongsy. One of his younger brothers was Souvanna Phouma. Bounkong's eleventh wife was the mother of Souphanouvong. Phetsarath went to study at the colonial Lycee Chasseloup Laubat in Saigon and continued on in 1905 to the Lycee Montaigne and to the Ecole des Affaires Coloniales in Paris. He returned to Laos in 1912, married Princess Nhin Kham Venne in 1913, and started working as an interpreter for his father. In 1914 he became a clerk at the Office of the French governor in Vientiane. Two years later he was promoted to assistant secretary to the French governor. In 1919 he was bestowed the title of Somdeth Chao Ratsaphakhinay, a title held by his father and one of the highest ranks in the country. That same year he was named Director of Indigenous Affairs of Laos operating under the French governor.
As the country's last oupahat, he became a leading figure of modern Laos. He established the system of ranks and titles of the civil service, promotion and pension plans, and created a Lao consultative assembly, reorganized the king's Advisory Council. Phetsarath reorganized the administrative system of the Buddhist clergy, and established a system of schools for educating monks in Pali. He created the Institute of Law and Administration to train entry level officers (Samien) who would then move up the ladder as Phouxouei, Chao Meuang, and Chao Khoueng successively. He set up rules to reward, reassign, and promote deserving civil servants, and created the judicial system, including civil and penal codes. Phetsarath played a dominant role in Lao politics before and after the Japanese occupation. He was the leader of the Lao Issara movement, and took important steps to modernize Laos.
He left for Thailand in 1946 to head the Lao Issara government-in-exile. In March 1957, he returned to Vientiane where he received a wild welcome. On 10 April 1957, he traveled to Louang Phrabang by car and was received by an enormous crowd of simple citizen, government officials, and members of the police and the army. On 16 April he paid a courtesy call to King Sisavang Vong and was given back his old title of oupahat of the Kingdom of Laos. In December 1957 he visited Samneua and Phongsaly where Souphanouvong symbolically offered the return of the Pathet Lao's two regrouping provinces to the Kingdom of Laos.
He was offered an official government residence in Vientiane, but preferred to stay in his his villa, Xieng Keo, in Louang Phrabang with his Thai consort, Mom Aphiphorn. In early October 1959 the Phoui Sananikone Government decided to use Phetsarath's official residence in Vientiane as the new prime minister's office. They vacated the building and shipped his personal belongings by boat to Louang Phrabang, which upset him immensely. On 14 October 1959 Phetsarath was taken ill to the hospital, suffering from a severe brain hemorrhage. A French doctor operated on him, but it was already too late. He never regained conscience and in the end passed away at the age of 69.
In part because of his popularity--in part because of his perceived saksit power--many Lao hang his picture in their homes.