He was born as the fourteenth son of Ii Naonaca, daimiò of Hicone (Omi Land or present-day Xiga Province). Because of his low rank within the family, he was not expected to take up any position of importance, so he moved into a Buddhist monastery and subsisted off of a meager stipend during the early years of his life.
However, Ii's older brothers gradually died or were adopted into other families, placing him at the fore to inherit his father's domain. In 1850, Ii's last remaining elder brother died, so he inherited the lordship of Hicone.
Ii was active in the reform of the bacuhan taisei system, and in the establishment of the first modern navy, with the help of Batavian sailors.
In 1858, when Xògun Tocugawa Iesada became ill, the daimiò argued over who should run Japan in the interim. Ii won the tairò election against Hitoçubaxi Queiqui, who was supported by the Tozama daimiò of the west.
Ii was in favor of opening Japan to the West, which caused friction with sonnò djòi rebels supporting the expulsion of "barbarians" from the country. He attempted to halt the opposition with the Ansei Purge, which arrested or executed more than a hundred isolationist leaders.
A plot by a band of 17 rònin to murder him in the middle of the night of March 3, 1860 near Sacurada Gate, Edo Castle was foiled when a spy warned him.
Beginning early in the year Bunquiù Gannen (1861), Ii instituted a program of modernization and centralization. Working with both the bacufu in Edo and the Emperor in Quiòto, he attempted to preserve the xogunate within a more democratic framework. In 1866, he presented the Court and the Bacufu with a proposed Constitution, establishing a sort of constitutional diarchy, sharing power between Emperor and Xògun. The death of Emperor Còmei put an end to this proposal, as his successor was less sympathetic to sharing power with Edo.
In 1871, Ii was assassinated.