Pelias was born to Tyro, the daughter of Salmoneus, the king of Elis in the western Peloponnese. Tyro had been given in marriage to Cretheus, the king of Iolcus, a port city on the eastern coast of Thessaly in northern Greece, but she had fallen in love with the sea god Poseidon, the brother of Zeus and ruler of the oceans. Poseidon came to her in the form of the river god Enipeus, and from their union were born twin sons, Pelias and Neleus. When Salmoneus discovered that his daughter had borne children who were not his son-in-law's, he ordered the infants exposed on a mountainside to die. But a herdsman found them and raised them among his horses, and the twins grew to manhood in the wilderness, strong and wild as the animals that had suckled them. When they learned their true parentage, they returned to Elis and killed Salmoneus, though some say it was only Neleus who participated in the murder while Pelias held back. The twins then parted ways: Neleus travelled south to found the city of Pylos in Messenia, while Pelias made his way to Iolcus, the kingdom that should have belonged to Cretheus's true heirs.

At Iolcus, Pelias found that Cretheus had died and that his son Aeson, the rightful king, sat on the throne. Aeson was a mild and just ruler, but Pelias was ambitious and ruthless. He gathered a band of armed men, marched on the palace, and seized power, either killing Aeson outright or imprisoning him and allowing him to waste away in a dungeon. Aeson's wife, who was called Polymele or Alcimede in different tellings, managed to save their infant son Jason by smuggling him out of the city and sending him to be raised by the centaur Chiron, the wise creature who was half man and half horse, who lived in a cave on Mount Pelion in Thessaly. Pelias ruled Iolcus with a heavy hand, and though he established games in honour of Poseidon and built temples to the gods, his reign was marked by the fear that had driven him to the throne: the fear that he would one day be overthrown by a rightful heir. The oracle at Delphi, the most sacred shrine in Greece, had warned him to beware of a man who came to Iolcus wearing only one sandal, a prophecy that haunted his dreams and made him suspicious of every stranger who arrived at his gates.

Years later, a young man came down from Mount Pelion and made his way to Iolcus. He was Jason, the son of Aeson, raised by Chiron in the arts of war, music, and medicine, and he had come to reclaim his father's throne. On his journey, he had lost one of his sandals in the flooded river Anaurus, and he arrived at the city gates with one foot bare and the other shod in leather. Pelias, watching from the palace, recognised the sign the oracle had foretold. He could not kill Jason outright without provoking the anger of the gods and his own people, so he devised a plan to send the young man to his death. He welcomed Jason with false warmth and promised to surrender the throne if Jason could perform one task: to retrieve the Golden Fleece, the gleaming hide of the winged ram Chrysomallos that had carried the boy Phrixus to safety in Colchis, a kingdom on the eastern shore of the Black Sea, and which now hung in a grove sacred to the war god Ares, guarded by a sleepless dragon. The task was impossible. The journey was fraught with monsters, storms, and hostile kings, and even if Jason reached Colchis, the fleece was protected by sorceries that no mortal could breach. Pelias believed he had solved his problem.

Jason accepted the challenge and assembled the greatest heroes of Greece, the Argonauts, named after their ship the Argo, which was built with timber from the sacred oak grove of Dodona and fitted with a speaking beam. They sailed to Colchis, and with the help of Medea, the daughter of King Aeetes and a priestess of Hecate, the goddess of magic, Jason obtained the fleece and returned to Iolcus. But Pelias had not kept his bargain. He had killed Aeson in Jason's absence, or in some versions he had driven the old king to suicide by forcing him to drink bull's blood, and he refused to yield the throne. Medea, who had betrayed her own father and murdered her own brother to help Jason, now turned her sorcery upon Pelias. She came to the palace disguised as an old woman and claimed that she could rejuvenate the aged with her magic. To prove it, she cut an old ram into pieces, boiled the meat in a cauldron with herbs and incantations, and a young lamb leaped from the pot. Pelias's daughters, led by Alcestis, the noblest of them, were desperate to restore their father's youth. They took knives and cut Pelias into pieces, just as Medea had done with the ram, and cast the pieces into the boiling cauldron. But Medea had withheld the true magic herbs, and Pelias did not rise again. His daughters had murdered their own father, and Medea and Jason fled Iolcus before the city could take revenge.

The death of Pelias was avenged by his son Acastus, who became king of Iolcus and who later held funeral games for his father that were famous throughout Greece. Acastus purified Jason and Medea of the murder, but the stain of Pelias's blood followed them both. Medea's cruelty in the killing of Pelias became one of the defining acts of her legend, the moment that proved she was capable of any horror in the name of love. Pelias himself became the archetype of the usurper who is destroyed by the very plot he devised to save himself, the king who sent a hero on a quest and found that heroes have a way of returning. The story of the one sandal, the Golden Fleece, and the cauldron of rejuvenation became one of the most famous cycles in Greek myth, and Pelias, though he never sailed on the Argo, was the man who made the voyage necessary.