João Donato de Oliveira Neto was born on August 17, 1934, in Rio Branco, the capital of the Brazilian state of Acre, into a musical household: his father, a police captain who was also the first aviator in Acre, played mandolin, his mother sang, his older sister Eneyda studied piano, and his younger brother Lysias Ênio would become his principal lyricist. As a small child he taught himself on a miniature accordion, and at eight he wrote a waltz, "Nini." Cuban music reached Acre by radio, an influence that stayed in his compositions and in his piano and trombone playing. In 1945 his father was transferred to Rio de Janeiro and the family moved with him; Donato took formal piano lessons there and learned trombone at school. He turned professional on accordion in 1949, at fifteen, and took part in the jam sessions of the Sinatra-Farney Fan Club in the Tijuca district, a gathering place for the young musicians who would later make bossa nova. His first recording was a 78 with the group of the flutist Altamiro Carrilho, on which he is not credited, and he soon moved on to the group of the violinist Fafá Lemos.

In April 1953 he issued his first records under his own name, instrumental trio versions of American and Brazilian songs billed to Donato e Seu Conjunto. That year he also formed Os Namorados, whose single "Eu Quero Um Samba" is credited with introducing the bossa nova beat. In 1955 he played accordion on the debut album of the guitarist Luiz Bonfá, with Antonio Carlos Jobim on piano, and with his friend João Gilberto he wrote "Minha Saudade." Gilberto later said, in an interview in the 1970s, that Donato had inspired the creation of bossa nova. Donato's first LP, Chá Dançante (Odeon, 1956), had its repertoire chosen by Jobim. By 1959 the clubs of Rio and São Paulo had stopped booking him, because dancers could not follow his modernist piano and other musicians found his charts hard to learn. Nanai, a former member of Os Namorados, offered him work in the United States, and he stayed for about thirteen years.

In the United States, Latin bandleaders sought out his harmonies and rhythmic sense. He recorded with Mongo Santamaría, among others on the Fantasy albums ¡Arriba! La Pachanga and At the Black Hawk, and played trombone for Tito Puente and for Eddie Palmieri's La Perfecta in 1962. He appeared on Astrud Gilberto's 1965 albums for Verve and on Bud Shank's Brazilian-themed records for Pacific Jazz and World Pacific. His own The New Sound of Brazil (RCA Victor, 1965), arranged and conducted by Claus Ogerman, opened with "Amazonas," and Pacific Jazz issued his Brazilian album Muito à Vontade in the United States in 1965 under the title Sambou Sambou. In 1968 he played organ on The Prophet and Solar Heat by vibraphonist Cal Tjader and took part in Sérgio Mendes's Favorite Things. His own A Bad Donato (Blue Thumb, 1970), produced by the percussionist Emil Richards, brought together American and Brazilian players, among them Bud Shank, Ernie Watts, the Candoli brothers, and Dom Um Romão, and became a template for later Brazilian jazz-funk. The 1973 Muse album Donato/Deodato, made with the arranger and keyboardist Eumir Deodato and a cast that included percussionists Ray Barretto and Airto Moreira and trumpeter Randy Brecker, paired him with Deodato again.

Donato returned to Brazil in 1972. At the end of that year the singer Agostinho dos Santos urged him to write words for his instrumental themes and sing them himself, and Quem É Quem (Odeon, 1973) made him a songwriter and vocalist for a Brazilian pop audience. In 1974 he was musical director of the singer Gal Costa's Cantar show, which introduced him to a younger generation of Brazilian artists, and in 1975 he recorded Lugar Comum with lyrics by Gilberto Gil, including the title song and "Bananeira." For the next decade he worked mainly as a sideman, arranger, and producer, appearing on Michael Franks's Sleeping Gypsy (1977), Milton Nascimento's Clube da Esquina 2 (1978), and João Bosco's Linha de Passe (1979). A live album, Leilíadas, appeared in 1986, and Coisas Tão Simples in 1996 marked his return to regular recording as a leader.

From 2000 he recorded steadily for small Brazilian labels, among them the collaboration Tudo Bonito with the singer and guitarist Joyce Moreno and the trio album Sambolero, which won the Latin Grammy for Best Latin Jazz Album in 2010; the same year he received the Latin Grammy Lifetime Achievement Award. In 2006 the state of Acre named a new arts campus in Rio Branco after him. Late in life he made the electric-keyboard records Donato Elétrico (2016) and Sintetizamor (2017, with his son Donatinho), and in 2021 Síntese do Lance with Jards Macalé and a release with Ali Shaheed Muhammad and Adrian Younge for the Jazz Is Dead series. He lived in the Urca district of Rio de Janeiro and passed away in Rio on July 17, 2023, at 88.

Donato's playing joined the harmony and swing of American jazz to Brazilian rhythm and to the Afro-Cuban music he heard as a boy and later played in California and New York. His harmonies and rhythmic ideas were advanced for the early bossa nova scene, which is why the dance clubs of the late 1950s turned him away and why Latin and jazz musicians in the United States hired him. AllMusic's biography treats him as a major shaping force in both bossa nova and Brazilian jazz, and Portuguese-language sources stress that he never stayed inside that single label: he moved between instrumental piano trios, Latin jazz, jazz-funk, sung Brazilian popular song, and, in his last years, synthesizers and electronics. As a composer he left songs that others made famous, among them "Amazonas," "Lugar Comum," "Simples Carinho," and "Bananeira," many of them instrumental themes that gained lyrics later and changed names in the process. He belonged to the generation, with João Gilberto, Antonio Carlos Jobim, Eumir Deodato, and Sérgio Mendes, that carried Brazilian music abroad, and A Bad Donato was a template for the jazz-funk that followed.