José Alexandre Gusmao was born in Laleia, Manatuto, East Timor on June 20th, 1946. He studied in a Catholic school before attending a Jesuit seminary in Soibada, the famous Catholic school in East Timor. Later he attended a seminary in Dare, a suburb of Dili, East Timor. During Portuguese rule in East Timor. Gusmão was a civil servant in the Department of Forestry & Agriculture.

Then, in 1974, when the Portuguese government decolonized East Timor, Xanana became a member of ASDT or the Social Democratic Party of East Timor; this party later changed to FRETILIN or the Revolutionary Front for Independence in East Timor. Xanana became a member of the Central Committee of FRETILIN and part of the Information Department. On 7th December 1975, Indonesia invaded East Timor and Xanana with all the members of FRETILIN and most of the population of East Timor escaped to the mountains to resist the invading troops.

Between 1978 and '79 when the majority of the FRETILIN leaders and the leaders of FALINTIL (the military wing of FRETILIN) were killed by Indonesian troops, particularly FRETILIN's President Nicolau Lobato (who was killed on 31 December '78) Xanana became the leader of FALINTIL. In 1981, when FRETILIN organised the resistance against Indonesia, the Congress asked Xanana to become their new President.

In March 1983 (23 March-8 August 1983) the Indonesian commander in East Timor, Colonel Purwanto negotiated with Xanana to find a peaceful solution to the conflict in East Timor. However, the new Indonesian Minister of Defence & Security General L. B. Murdani ended these negotiations because Xanana requested that a UN Mediator be involved in the talks.

In 1986, Xanana and his colleagues in the mountains created the National Council of Maubere Resistance (CNRM) which is the umbrella organisation against Indonesian rule in East Timor.(This includes FRETILIN, FALINTIL, the Catholic Church, and UDT) Xanana became the Chairman of CNRM and Commander-in-chief of FALINTIL.

In November 1991 the Santa Cruz massacre took place in Dili, East Timor and Indonesian troops killed more than 200 young people. The Indonesian Commander-in-chief of the armed forces General Try Sutrisno (now Vice-President of the Republic of Indonesia) accused Xanana of being responsible for the Santa Cruz massacre, claiming that Xanana instructed the students to start a demonstration in the cemetery.

In November 1992, Xanana was arrested in Dili by Indonesian military for subversion and in April of the following year the Indonesian courts in Dili sentenced him to life imprisonment.

A few months later the Indonesian government sent Xanana to a political prison in Semarang in Central Java and at the end of 1993 they sent him to another political prison, Cipinang Prison, in Jakarta where he remains still.
In early 1994 after much international pressure, President Suharto of Indonesia reduced Xanana's sentence from life to 20 years imprisonment.

The East Timorese Resistance still recognise Xanana as leader of the Resistance although he is imprisoned.
Xanana is married with one daughter and one son. They all went to Australia in 1989 with the help of the International Red Cross Committee.