Fayzulla Khodzhayev was born in Bukhara into the family of a wealthy Uzbek merchant. In 1907–1913, he studied in Russia. In 1913, he joined the Jadids (from the Arabic Jadid meaning “new”) Muslim modernist reformers. In 1916–1920, he was a leader of the party of the Young Bukharans [Mladobukhartsy] (since 1917, the committee of the Young Bukharans party), which stemmed from the Jadid movement.

After the October Revolution of 1917, Khodzhayev established contacts with the Bolsheviks. On behalf of the Central Committee of the Young Bukharans party, he appealed for help to organize an uprising against the Bukhara Emir Alim Khan to the Chairman of the Council of People’s Commissars of Soviet Turkestan Fyodor Kolesov. At the beginning of 1918, he became Chairman of the revolutionary committee for preparing an uprising against the Emir, together with the Bolsheviks. After the defeat of the Tashkent uprising (Kolesov’s campaign, March 1918) Khodzhayev had to leave Bukhara. In the Soviet part of Turkestan, he elaborated the party’s program, which provided for the overthrow of the Emir and the establishment of a democratic republic. In January 1920, he created in Tashkent the Turkestan Central Bureau of the Young Bukharans-revolutionaries.

In September 1920, Khodzhayev was a leader of the Bukhara Communist Party, which had united with Young Bukharans-revolutionaries. He participated in the overthrow of Emir Alim Khan and the establishment of the Bukharan People’s Soviet Republic led by Mikhail Frunze fighting in the ranks of the Workers’ and Peasants’ Red Army (September 1920).

In September 1920 – October 1924, he was Head of the government (Chairman of the Council of People’s Nazirs) of the Bukharan People’s Soviet Republic. Since 1922, he was a member of the Central Asian Bureau of the Central Committee of the Russian Communist Party (Bolsheviks) – RCP(b), a member of the Revolutionary Military Tribunal of the Bukhara Group of Forces for Combating Basmachi movement. He was awarded the Order of the Red Banner (1920). In 1923–1924, Khodzhayev held the post of Commander of the 1st Bukhara Red Army. In 1924–1937, he was Chairman of the Council of People’s Commissars of the Uzbek SSR.

In 1938, in the so-called Case of Trotskyist Anti-Soviet Military Organization, he was convicted on charges of Trotskyist conspiracy to overthrow the Soviet system in Uzbekistan and of espionage for Germany, Japan, Poland, and the United States. Khodzhayev was executed. He was rehabilitated in 1965.