Phillip joined the British Navy in 1755, retired in 1763 to farm for 13 years in England, then served with the Portuguese Navy against Spain (1776) and with the British Navy against France (1778). In 1786 he was assigned the duty of founding a British convict settlement in New South Wales, and the following year he set sail with 11 ships.

As the first governor of New South Wales, Phillip struggled with rebellious convicts and troops and—until the middle of 1790—with the threat of famine; but he successfully created a permanent community. Despite his conciliatory policy toward the native Aborigines, he failed to establish peace between the settlers and the natives. He returned to England in 1792 because of poor health, but he saw further action at sea (1796–98) and was promoted to admiral in 1814.