From 1934, he studied both Ancient Greek and Roman literature and English literature at Merton College, Oxford University, England, receiving B. A. and M. A. (Honors) degrees.
In 1937, after the outbreak of the War of Resistance Against Japan, Yang, together with Xiang Da, Lv Shuxiang and others, launched a newspaper in Chinese for national salvation and resistance to the Japanese.
In 1940, accompanied by his wife, Gladys Yang, Yang Xianyi returned to China and taught English at the Central University in Chongqing, Normal College in Guiyang and Guanghua University in Chengdu. Three years later, he became a senior translator at the National Bureau of Compilation and Translation in Chongqing. During this period, apart from completing a series of translations from Chinese to English, he also published Ling Mo Xin Jian, a collection of articles on Chinese history and literature as well as East-West cultural exchange.
In 1949, upon the liberation of Nanjing, Yang was made deputy director of the National Bureau of Compilation and Translation. In 1953, he was transferred to Beijing and worked as an expert in the translation department of the Foreign Language Press. He translated foreign literature and, in collaboration with Gladys Yang, translated literary works by ancient and modern Chinese writers.
In 1963, the couple began translating the classic novel A Dream of Red Mansions, which was published in 1980. During the Cultural Revolution, Yang suffered from political persecutions and was put into prison. In October 1976, after being rehabilitated, he was appointed editor-in-chief of the English-language quarterly Chinese Literature. He was also made a research fellow and an academic member of the Institute of Foreign Literature under the Chinese Academy of Social Sciences. The following year, he helped launch Panda Books, a publisher of contemporary Chinese fiction in English.
Throughout his life, Yang Xianyi worked hard to promote the cultural exchange between China and other countries. His translations have been highly acclaimed both at home and abroad. He was often invited to give lectures in Britain, Australia, Japan, India, and other countries.
He also served as senior advisor to the Chinese Literature Press, and was a member of the Chinese People's Political Consultative Conference (CPPCC), and a council member of the Chinese Writers' Association.
Yang passed away in Beijing on November 23, 2009.
His main works include Ling Mo Xin Jian (1947), Selections of English Poetry (1948), Qu Yuan's Li Sao (1953), The Courtesan's Jewel Box, Tales from the Tang Dynasty (1954), The Palace of Eternal Youth (1955), Selected Works of Lu Xun (1956), Virgil's Eclogues (1957), Selected Plays by Guan Hanqing (1959), Aristophanes' The Birds and Peace (1959), Cao Xueqin's A Dream of Red Mansions (1978-80). Homer's Odyssey (1979), Sima Qian's Records of the Historian (1979) and Bernard Shaw's Pygmalion and Caesar and Cleopatra (1982).