He was the son of Luis Colosio Fernández (1923–2010) and Ofelia Murrieta Armida García. Born into a family with a long political heritage in Magdalena de Kino, Sonora, Colosio-Murrieta was the descendant of 16th century Italian immigrants to New Spain who settled in the rural territories of the northwest, in the modern state of Sonora. Colosio-Murrieta studied at the Instituto Tecnológico y de Estudios Superiores de Monterrey, better known by its initials ITESM, after which he joined the Institutional Revolutionary Party (PRI) in 1972. After that, he began postgraduate studies at University of Pennsylvania and research at the International Institute for Applied Systems Analysis in Austria before returning to Mexico. In 1979, he joined the Ministry of Budget and Planning under future president Carlos Salinas de Gortari.
He was elected to Congress as the federal deputy for his home town in 1985 and, in 1987, he was selected to serve on the PRI's National Executive Committee. In 1988, Carlos Salinas chose him as the campaign manager for his presidential campaign. In the same election, Colosio was elected to the Senate, representing Sonora.
In the early years of Salinas's presidency, Colosio served as the chairman of their party's National Executive Committee. In 1992, Salinas chose him to serve in his cabinet, in the newly created position of Social Development Secretary. In November 1993, the PRI announced that Colosio was to be its candidate for the upcoming presidential election.
After a slow start, with the spotlight focusing on former foreign minister Manuel Camacho's negotiations with the EZLN guerrillas, Colosio appeared to get the traditional support of the political machine of the PRI. Like all the PRI's previous presidential candidates, he was greeted by large crowds throughout his presidential campaign, although the PRI's waning popularity meant some reduction in enthusiasm. Since Mexico's constitution permits presidents to remain in power for only one term, and as an extralegal rule presidents (until Salinas) handpicked their own successors (the party's first primary election in history took place in 1999), Colosio apparently enjoyed the president's favour, expressed in his famous declaration No se hagan bolas: el candidato es Colosio ("Don't get confused: Colosio is the candidate" would be an appropriate translation, literally it means "Don't entangle yourselves: Colosio is the candidate").
Salinas' declaration was motivated by persistent rumours that highly visible Camacho would replace Colosio, who was not doing well in his campaign. Camacho let speculation grow for some time, but eventually declared he wouldn't run for office, concentrating his attention on the Chiapas rebellion instead. The day after Camacho's statement, Colosio was killed.
At 5:05 PM PST, on 23 March 1994, at a campaign rally in Lomas Taurinas, a poor neighborhood of Tijuana, Baja California, Colosio was shot in the head with a .38 Special at a distance of a few centimeters from a nearby person recording a video. Colosio collapsed, and was subsequently rushed to the city's main hospital, after plans to fly him to an American hospital across the border were canceled. His death was announced a few hours later, amid contradicting eyewitness reports that remain to this day.
The shooter, Mario Aburto Martínez, was arrested at the site and never wavered from his story that he had acted alone. Nonetheless, many theories still surround Colosio's assassination. The authorities were criticized for their poor handling of Aburto, having shaved, bathed and given him a prison haircut before showing him to the media, which started rumors about whether that man, who looked so different from the one arrested, was really the murderer. Colosio received three bullet wounds, and it was never clear if they could have been done by a single person or not. The case was officially closed after many different prosecutors investigated it, but after the many mishandlings of the investigation and contradictory versions, the controversy continues. Aburto remains imprisoned at the high-security La Palma facility in Almoloya de Juárez.
On 18 November 1994, Diana Laura Riojas, the wife of Colosio, died while she was investigating on her own the murder of her husband; officially she died from pancreatic cancer.
With only four months before the election, the PRI found itself hamstrung by the constitutional requirement that no presidential candidate can hold public office during the six months immediately prior to the election; this effectively disqualified the entire cabinet, where most of the more promising replacements were. Of the few potential candidates available, Salinas eventually chose Ernesto Zedillo, who had just resigned as Education Minister to serve as Colosio's campaign manager, because Manlio Fabio Beltrones, a very close collaborator of the murdered candidate, showed a video where Colosio praised Zedillo. This stroke of luck for Zedillo, who would have never been a candidate under normal circumstances, gave rise to even more rumours – unfounded or not.
A few months later, Salinas' brother-in-law, José Francisco Ruiz Massieu, president of the PRI, was also murdered in plain daylight in Mexico City, eliminating the two most visible and powerful official heads of the PRI in Mexico, Colosio and Ruiz Massieu. Eventually Ernesto Zedillo was elected president.
Eight months after Colosio's assassination, his wife, Laura Riojas, died of cancer. News magazine Proceso reported Colosio's widow's first words upon learning of her husband's assassination: "Who did it?" Two children, now cared for by relatives, survived. Colosio's father continued determined to uncover what he strongly suspected are hidden truths behind his son's very public murder and, in 2004, he published a book about the case. He died in 2010.
Colosio: El asesinato (2012), directed by Carlos Bolado, explored the aftermath of the assassination of the candidate and various conspiracy theories. It notes that two investigations were conducted, and details the 15 associated people who were killed following the investigation, as well as widespread violence and unrest.
Mexican rock group El Tri wrote a song about the assassination of Colosio called "Con la cola entre las patas" (With the tail between the legs).