He was born in Abu Dis (near Jerusalem) in 1937 to a relatively wealthy family. He joined the Fatah wing of the Palestinian Liberation Organization (PLO) in 1968. As a banker, he used his expertise during the 1970s as the director of the PLO's foreign investment branch and director-general of the PLO's economic branch, helping to make the organization one of the largest employers in Lebanon. He followed Yasser Arafat to Tunis after the PLO was forced to leave Lebanon. As more senior leaders died, Qurei rose to prominence and was elected to the Fatah Central Committee in August 1989.
As a member of the Central Committee, Qurei was instrumental in negotiating the Oslo Accords. He held various posts in the first Palestinian Authority cabinets including Minister of Economy & Trade and Minister of Industry. He was also responsible for a development plan for the Palestinian territories submitted to the World Bank in 1993. He also founded and became director of the Palestinian Economic Council for Development and Reconstruction (PECDAR) in 1993 in order to help garner money from international donors. Soon after, he was elected to the PLC and was elected Speaker in March 2000.
After the resignation of Palestinian Prime Minister Mahmoud Abbas on September 6, 2003, Arafat nominated him to fill the post. Qurei said he would only accept the job if Washington "guarantees Israeli compliance with a U.S.-backed peace plan, including a halt to military strikes." 
He was appointed by an emergency decree on October 5, sworn in on October 7, but already on October 12 threatened his resignation due to a dispute with Arafat over control of the security services. The emergency cabinet's term expired on November 4 and Qurei declared that he was willing to lead a new cabinet provided the support of the parliament could be obtained. He obtained this approval on November 12.