Castro worked as a cowboy in the Andean region. Enlisting the support of a powerful Venezuelan general, he entered politics and became the governor of his province of Táchira but was exiled to Colombia when the government in Caracas was overthrown in 1892. He lived in Colombia for seven years, amassing a fortune in illegal cattle trading and recruiting a private army, with which he successfully attacked Caracas in 1899. Installed as the supreme military commander and later as president of Venezuela, Castro inaugurated a period of plunder and political disorder.

Castro's rule was marked by frequent rebellions, the murder or exile of his opponents, his own extravagant living, and trouble with other nations. When he refused to make payments on foreign debts, British, German, and Italian ships set up a blockade in 1902 to force payment. The issue was eventually resolved through arbitration.

Seriously ill and exhausted by his excesses, he left for Paris in 1908 to seek medical aid, leaving the government in the hands of his lieutenant Gómez, the man who was instrumental in his victory of 1899. Gómez seized the government for himself, and Castro remained an exile for the last 16 years of his life, mostly in Puerto Rico, unsuccessfully plotting his return to Venezuela.