Parri was born in Pinerolo, Piedmont. A soldier during World War I, he was wounded four times and received four decorations. He studied literature and after the war he was a journalist with the Corriere della Sera.
He became active against Benito Mussolini's Fascist regime and joined Carlo and Nello Rosselli's group Giustizia e Libertà (Justice and Liberty), the most important Italian non-Marxist antifascist movement.
In 1926 he was involved in the escape of the reformist socialist leader Filippo Turati, together with Carlo Rosselli and Sandro Pertini. He was sentenced to 10 months in prison. He was arrested several times and banished to the islands Ustica and Lipari. In 1930 he was again banished for five years together with other leaders of Giustizia e Libertà.
During World War II, Parri joined the Italian resistance movement to fight the Nazi German occupiers and Mussolini's Italian Social Republic, leading the Action Party (Partito d'Azione) – founded in 1942 by former militants of Giustizia e Libertà – and its partisan groups in northern Italy (alongside representatives of other factions, such as Sandro Pertini, Rodolfo Morandi and Lelio Basso). He was also president of the Comitato di Liberazione Nazionale.
In January 1945 Parri was arrested in Milan. He was released in March 1945 in Lugano (Switzerland) as part of Operation Sunrise – a series of secret negotiations between Allen Dulles, head of the U.S. Office of Strategic Services (OSS) and representatives of the German Wehrmacht command in Northern Italy, which led to the unconditional surrender of the German forces in Northern Italy and Western Austria on May 2, 1945. The release of Parri was requested from the Germans as an evidence of good faith and the ability to act. He returned in time to take part in the conclusive phase of the resistance and in the uprising in April.
After the end of World War II, he was appointed leader of a government supported, among the others, by the Action Party, the Christian Democracy, the Communist Party, the Socialist Party and the Liberal Party. A middle-of-the-road man, he had been chosen as the compromise leader of a compromise Cabinet. He was also the Minister of the Interior (in charge of the police). When the Liberals withdrew their support from the coalition government, Parri resigned from his position.
At the time Parri warned: "Beware of civil war ... of reopening the door to fascism. ... There are rumors that Washington and London have no trust in me. The real reason for this lack of trust is that Italy has only a fragile front of antifascism. ... I hope my successors will follow the only worthy policy for Italy: left of center... ."
The Action Party quickly faded from the Italian political scene. Parri founded, together with Ugo La Malfa, the movement Concentrazione Democratica, which was later absorbed into the Italian Republican Party (Partito Repubblicano Italiano – PRI). In 1953 he left the latter party to create the short-lived Unità Popolare with Piero Calamandrei. In 1957, the party merged into the Italian Socialist Party (Partito socialista italiano – PSI).
In 1946, he was elected to the Italian Italian Constituent Assembly and in 1948 to the Italian Senate.
In 1958 he was elected in the Senate on the list of the PSI. Parri proposed to form a Parliamentary Antimafia Commission to investigate the Sicilian Mafia. The proposal was not taken up by the parliamentary majority; and in 1961 the Christian Democrat party (DC – Democrazia Cristiana) in the Senate and Sicilian politicians such as Bernardo Mattarella and Giovanni Gioia (both later accused of links with the Mafia) dismissed the proposal as useless. However, in 1962 a Commission was formed to deal with the issue, and Parri became a member.
In 1963, President Giuseppe Saragat appointed Parri senator for life. He adhered to the Independent Left group, and was for long its chairman. In March of the same year, he became the editor of the magazine L'Astrolabio, in which he argued in favour of a more accomplished democracy and denounced the resurgence of neofascism.
Parri was the president of the Federazione italiana associazioni partigiane (FIAP), and authored several important studies on the history of the Italian resistance.
Parri died in Rome on 8 December 1981 at the age of 91. He once characterized himself: "I am a common man – uomo della strada. I am just another guy – uomo qualunque ... I hope a typical one. My job is not only to prevent the right and left wings from exercising undue influence on the Government, but I have to think too of the enormous masses of peasants sweating in the fields under the sun, blacksmiths beating their anvils in villages, workers, men and women everywhere who have no taste for politics and are outside parties. ... I am just a uomo della strada... ." Parri is buried at the Monumental Cemetery of Staglieno in Genoa.