Born Gaius Caesar, he became known as Caligula (Little Boot), a childhood nickname bestowed on him by the soldiers of his father, Germanicus Caesar, nephew and adoptive son of Tiberius. The deaths of his father in AD 19, of his mother, Agrippina the Elder, in 33, and of his two elder brothers, Julius Caesar Nero in 31 and Drusus Caesar in 23, were popularly ascribed to the machinations of Tiberius. Gaius and his three sisters survived. Adopting his father's distinguished name, he became Gaius Caesar Germanicus.

He was severely ill seven months after his accession; after this he restored treason trials, showed great cruelty, and engaged in wild despotic caprice, e.g., he bridged the Bay of Naples with boats from Baiae to Puteoli in the summer of 39. In 38 he executed Naevius Sutorius Macro, prefect of the Praetorian Guard, to whose support he owed his accession, and Tiberius Gemellus, grandson of Tiberius, whom he had supplanted in the succession. He made pretensions to divinity and showed extravagant affection for his sisters, especially for Drusilla, who on her death (38) was consecrated Diva Drusilla, the first woman in Rome to be so honoured. Some scholars believe that he intended to establish a Hellenistic-type monarchy after the brother–sister marriages of the Ptolemies of Egypt. Others thought that after his illness he was mad; but much evidence of this is suspect and some—e.g., that he made his horse consul—is untrue. (See Researcher's Note.) He may have suffered from epilepsy.

Caligula appeared unexpectedly on the Upper Rhine in October 39 and suppressed an incipient revolt, executing Drusilla's widower M. Aemilius Lepidus and Gnaeus Lentulus Gaetulicus, commander of the Upper Rhine armies. After his accession Caligula quickly squandered the vast sums Tiberius had accumulated in the state treasury. To procure the revenues needed to finance his extravagances, he then resorted to the extortion of prominent Roman citizens and the confiscation of their estates.

Early in 40 Caligula marched with an army into Gaul, whose inhabitants he plundered thoroughly. He marched his troops to the northern shoreline of Gaul as a prelude to the invasion of Britain but then ordered them to collect seashells there, which he called the spoils of the conquered ocean. Caligula pursued his pretensions to divinity further; in the summer of 40 he ordered his statue to be erected in the Temple at Jerusalem, but under the suave persuasion of Herod Agrippa, Caligula countermanded this potentially disastrous order. The Roman populace had by now grown weary of this mad and unpredictable tyrant, and several conspiracies were formed against him. In January 41, four months after his return to Rome from Gaul, Caligula was murdered at the Palatine Games by Cassius Chaerea, tribune of the Praetorian guard, Cornelius Sabinus, and others. Caligula's wife Caesonia and his daughter were also put to death. He was succeeded as emperor by his uncle Claudius.