Born in Paris, Passy's uncle Hippolyte Passy was a cabinet minister for both Louis Philippe and Louis Napoleon. Passy studied law and then became an accountant in the State Council. However, he returned to the university to study economics and became a professional economist in 1857.
Passy directly engaged in political questions, advocating educational reform and intervening to prevent war between France and Prussia over Luxembourg. He helped found the Ligue internationale et permanente de la paix to avert possible future conflicts. When the organization dissolved during the Franco-Prussian War, Passy helped restructure it as the Société française des amis de la paix, which in 1889 became the Société d'arbitrage entre les Nations.
In 1881, he won election to the Chamber of Deputies, where he advocated foreign policy changes and labor reform, including legislation on industrial accidents. He won reelection in 1886 but lost in 1889. He also supported a system of international conflict arbitration, which was inspired by Randal Cremer's resolution that established arbitration between the United States and England. In 1888, his efforts led to a meeting between British Parliamentary members and French deputies to discuss the concept of organized arbitration. The following year, the Inter-Parliamentary Union was established with Passy as one of its presidents.
Passy's writings and speeches advocating peace were widely recognized. In 1909, he published Pour la paix, a work which chronicled the establishment of the various peace and arbitration organizations with which he was associated.
