Budge was born in 1857 and began his education in ancient languages outside formal university study while working in London. His early interest was supported by scholars connected with the British Museum, including Samuel Birch. He was not, however, simply an untrained self-taught curator. He entered Christ's College, Cambridge in 1878, studied Semitic languages and graduated before joining the British Museum in 1883.

At the British Museum Budge worked first with Assyrian and then Egyptian material. In 1894 he became Keeper of Egyptian and Assyrian Antiquities and remained in that senior post until retirement in 1924. The National Portrait Gallery describes him as prolific but not always accurate and notes that he published more than one hundred monographs.

Budge made repeated journeys to Egypt and the Middle East to acquire manuscripts and antiquities for the British Museum. Those collecting activities greatly enlarged the institution's holdings but also relied on practices that would not meet modern standards. Christ's College now explicitly notes that the removal of material culture associated with Budge would be illegal under modern laws and that the effects on local communities received little consideration at the time.

The Papyrus of Ani became one of the objects most closely associated with his name. British Museum records state that the manuscript entered the collection in 1888 through Budge. His 1895 publication of the Papyrus of Ani gave readers hieroglyphic text, transliteration, translation and extensive commentary, helping to make this particular Book of the Dead manuscript internationally famous. It was an influential edition, but it was not the first English translation of the entire Egyptian funerary corpus and should not be described as such.

Budge's translations and religious interpretations reflect the state of Egyptology in the late nineteenth and early twentieth centuries. Later advances in grammar, philology, archaeology and contextual study have superseded many of his readings. For modern historical work his translations should be checked against later editions, but they remain significant witnesses to the history of Egyptology and are often useful when Mythopouch needs a verified public-domain English source.

His bibliography extends far beyond the Papyrus of Ani. Works such as The Mummy, Egyptian Magic, Osiris and the Egyptian Resurrection, An Egyptian Hieroglyphic Dictionary and publications on Tutankhamun helped shape popular English-language ideas about ancient Egypt. Budge's writing frequently interpreted Egyptian religion through assumptions common in Victorian and Edwardian comparative religion, so modern readers need to distinguish his historical importance from current Egyptological consensus.

Budge was knighted in 1920 and died in 1934. Through bequests he supported future Egyptological study, including fellowships linked with Christ's College and Oxford. His legacy is therefore double: an extraordinarily productive editor and curator who widened access to ancient texts, and a representative of collecting and interpretive practices that modern scholarship must examine critically rather than simply repeat.