Krupa was born in Chicago, Illinois. He began playing professionally in the mid 1920s with bands in Wisconsin.

He made his first recordings in 1927, with a band under the leadership of banjoist Eddie Condon and "fixer" (and sometime singer, who did not appear on the records), Red McKenzie: these sides are now recognised as the first, and definitive, examples of white "Chicago Style" jazz. The numbers recorded at that session were: 'China Boy', 'Sugar', 'Nobody's Sweetheart' and 'Liza'.

The McKenzie - Condon sides are also notable for being the first records to feature a full drum kit. Eddie Condon describes what happened in the Okeh studio on that day (in 'We Called It Music' - pub: Peter Davis, 1948):

"Mezzrow (Milton "Mezz" Mezzrow) was helping Krupa set up his drums. 'What are you going to do with those?' Rockwell (Okeh's 'A&R' man in the 1920's) asked. 'Play them,' Krupa said simply. Rockwell shook his head. 'You can't do that,' he said. 'You'll ruin our equipment. All we've ever used on records are snare drums and cymbals.' Krupa, who had been practising every day at home, looked crushed. 'How about letting us try them?' I asked. 'The drums are the backbone of the band. They hold us up.' I could see that Rockwell was leery of the whole business; drums or no drums, I figured, we are probably going to get tossed out. 'Let the kids try it', McKenzie said. 'If they go wrong I'll take the rap'. I didn't know until long afterwards that Red had guaranteed our pay for the job'...

"Quietly we waited for the playback. When it came, pounding out through the big speaker, we listened stiffly for a moment. We had never been an audience for ourselves...Rockwell came out of the control-room smiling. 'We'll have to get some more of this... (Rockwell nodded towards Krupa): didn't bother the equipment at all,' he said. 'I think we've got something,'".

Krupa moved to New York City in 1929 and worked with the band of Red Nichols. In 1934 he joined Benny Goodman's band, where his featured drum work — especially on the hit "Sing, Sing, Sing" — made him a national celebrity. In 1938 he left Goodman to launch his own band and had several hits with singer Anita O'Day and trumpeter Roy Eldridge. Krupa made a memorable cameo appearance in the 1941 film Ball of Fire, in which he and his band performed an extended versions of the hit Drum Boogie.

In 1943, Krupa was arrested for possession of marijuana and was given a brief jail term. After his release, Krupa reorganized his band with a big string section, featuring Charlie Ventura on sax. It was one of the largest dance bands of the era, sometimes containing up to forty musicians. He gradually cut down the size of the band in the late 1940s, and from 1951 on led a trio or quartet, often featuring the multi-instrumentalist Eddie Shu on tenor sax, clarinet and harmonica. He appeared regularly with the Jazz At the Philharmonic shows.

Krupa largely went into retirement in the late 1960s, although occasionally played in public until shortly before his death from leukemia in Yonkers, New York. He was buried in Holy Cross Cemetery in Calumet City, Illinois.