Born in Brooklyn, New York City, New York, he became a gang member, and was arrested several times. After serving his last jail sentence, he converted to Islam. He went to the Masjid Al-Iman mosque in Fort Lauderdale, Florida with Adham Amin Hassoun, who at that time was the Florida registered agent for Benevolence International Foundation, a charity which United States Investigators have accused of funding terrorist activities. Padilla and Hassoun became friends. U.S. authorities accuse Hassoun of consorting with radical Islamic Fundamentalists, possibly including Al-Qaida. Hassoun was arrested in 2002 for overstaying his visa. 
Padilla later traveled to Egypt, Saudi Arabia, Afghanistan, and Pakistan. On his return, he was arrested by federal agents at Chicago's O'Hare International Airport on May 8, 2002. Subsequently he was declared an enemy combatant and accused of participating in the construction of a radioactive dirty bomb. No evidence was presented, no legal proceedings authorized, and he was not allowed to talk to his lawyer. He is being held in a naval brig at Goose Creek, South Carolina.
On December 18, 2003, the U.S. Second Circuit Court of Appeals declared that the Bush Administration lacked the authority to designate a U.S. citizen arrested on U.S. soil an enemy combatant without clear congressional authorization; it consequently ordered the government to release him from military custody within thirty days.