Albert Laurence Di Meola was born on July 22, 1954, in Jersey City, New Jersey, into an Italian family with roots in Cerreto Sannita, a small town northeast of Benevento, and grew up in Bergenfield, New Jersey, where he attended Bergenfield High School. He picked up the guitar at eight after hearing Elvis Presley and the Ventures, and his older sister's gift of Meet the Beatles! at Christmas 1963 settled his ambition to be a musician. His first teacher, Bob Aslanian, steered him toward jazz standards and taught him theory and reading, and as a teenager he practiced eight to ten hours a day. The players who set his direction were the jazz guitarists George Benson, Tal Farlow and Kenny Burrell, and the fusion pioneers Larry Coryell and John McLaughlin. He entered Berklee College of Music in 1971.

In 1974, at nineteen, he was hired by Chick Corea to replace Bill Connors in Return to Forever, alongside bassist Stanley Clarke and drummer Lenny White. He is the guitarist on Where Have I Known You Before (1974), No Mystery (1975), and Romantic Warrior (1976), the band's first album for Columbia, recorded in February 1976 at Caribou Ranch near Nederland, Colorado, with his own piece "Majestic Dance" on it. The title track of No Mystery won the 1976 Grammy for Best Jazz Performance by a Group; the band did not attend the ceremony, and Ella Fitzgerald presented the award. Romantic Warrior was certified gold in 1990. In 1975 he and Coryell traded solos on "Prince of the Sea" on White's debut Venusian Summer. Corea broke up the classic lineup after the Romantic Warrior tour, and the four reunited for the track "Compadres" on Corea's Touchstone (1982) and for a short American and Japanese tour in 1983.

His own recording career began as Return to Forever wound down. Land of the Midnight Sun (Columbia, 1976) brought in Corea, Clarke, bassist Jaco Pastorius, and drummers Steve Gadd, Lenny White and Alphonse Mouzon. Elegant Gypsy (1977) reached number 5 on Billboard's jazz albums chart and number 58 on the Billboard 200, went gold, and was promoted with a sold-out American tour with Weather Report, whose bassist was by then Pastorius, and whose Heavy Weather came out the same week. Casino (1978) followed, and from 1976 to 1978 he also played in Stomu Yamashta's supergroup Go, which included him on Go Live from Paris (1976) and Go Too (1977). The double album Splendido Hotel (1980) had guest turns from Corea and Jan Hammer, and a duet on "Spanish Eyes" with Les Paul.

In 1980 he joined John McLaughlin and the flamenco guitarist Paco de Lucía for a tour that produced the three-guitar acoustic set Friday Night in San Francisco, recorded live at the Warfield Theatre on December 5, 1980, and released in 1981. The trio made a studio follow-up, Passion, Grace & Fire (1983), and reunited for The Guitar Trio (1996). In between came Electric Rendezvous (1982) with Hammer and Gadd, the live Tour de Force (1982), and Scenario (1983), which carries Hammer, Tony Levin, Bill Bruford and Phil Collins. In 1983 he also played the guitar solo on "Allergies" on Paul Simon's Hearts and Bones. After touring for about ten years straight he took 1984 off, left Columbia, and made his next three albums for Manhattan Records: the mostly acoustic Cielo e Terra (1985), with percussion by Airto Moreira, Soaring Through a Dream (1985), and Tirami Su (1987), the latter two billed to the Al Di Meola Project, with keyboardist and arranger Kei Akagi on the 1987 album. He also produced guitarist Stanley Jordan's Blue Note debut Magic Touch (1985), and on June 8, 1987, he was among the guests at Les Paul's 72nd birthday celebration in New York.

For fifteen years he worked mostly in acoustic and world-music settings, partly because of hearing damage from years of loud playing. The electric Kiss My Axe (1991, Tomato) was the exception; the acoustic World Sinfonia (1991), built around tangos by Ástor Piazzolla and the bandoneon of Dino Saluzzi, gave its name to his World Sinfonia projects, which continued with World Sinfonia: Heart of the Immigrants (1993, with string arrangements by Vince Mendoza), Orange and Blue (1994), and the Piazzolla tribute Di Meola Plays Piazzolla (1996). In the mid-1990s he, Clarke, and Jean-Luc Ponty made the all-acoustic The Rite of Strings and toured the world, including a South American leg that began with about 7,000 people at Luna Park in Buenos Aires. For Telarc he made The Infinite Desire (1998), Winter Nights (1999), World Sinfonía III: The Grande Passion (2000, with the Toronto Symphony Orchestra on part of it), and Flesh on Flesh (2002).

He returned to electric guitar in the mid-2000s with Consequence of Chaos (2006), which features Corea, Gadd, and John Patitucci, and in 2008 rejoined Return to Forever for a reunion tour; the band received the BBC Jazz Awards' Lifetime Achievement Award that year, and the live set Returns appeared in 2009. His later studio albums are Pursuit of Radical Rhapsody (Telarc, 2011), which earned a Latin Grammy nomination for best instrumental album, All Your Life (2013), a set of Beatles songs recorded at Abbey Road Studios, Elysium (2015), Opus (2018), Across the Universe (2020), another Beatles collection, and the two-disc Twentyfour (earMUSIC, 2024). Berklee awarded him an honorary doctorate. In September 2023 he had a heart attack on stage in Bucharest, Romania, and cancelled dates on his "Electric Years" tour; he went back to performing in January 2024 and was still playing concerts in 2026.

Di Meola is known for fast, exactly articulated alternate picking, palm-muted single-note lines, and crosspicked arpeggios, and he has said he avoids sweep picking, hammer-ons, and tapping as shortcuts that get in the way of playing intricate music. His compositions draw on Mediterranean, Latin, flamenco, and Middle Eastern sources, often with non-Western modes; "Egyptian Danza" from Casino is built on a Phrygian dominant scale. He came up on the Beatles, Santana, and the San Francisco bands, then on jazz: he called McLaughlin the first guitarist he heard to combine great emotion with great technique, and said Coryell's approach gave him confidence to continue in his own direction. Later he turned to Piazzolla's tango repertoire and named the Brazilians Egberto Gismonti and Milton Nascimento among his enthusiasms. He has described Return to Forever as a band of composed structure and guitar parts, more so than the Mahavishnu Orchestra or Weather Report. His reception has always been divided: some critics, and guitarists such as Gary Moore, heard clinical speed, while others, and the readers of Guitar Player, who voted him repeated poll wins between 1975 and 1987, heard a composer. Di Meola himself dislikes the label of shredder and sees himself as a composer first, and McLaughlin criticized his use of other cultures' music in "Egyptian Danza". His speed and attack were an influence on rock and metal guitarists including Paul Gilbert, Nuno Bettencourt, and John Petrucci.