Bahrdt was born on August 25, 1741, at Bischofswerda, Upper Lusatia, where his father was pastor of the local church. The elder Bahrdt was later a professor, canon, and general superintendent at Leipzig. He received his early education at the celebrated school of Pforta, but some commenters have found his training to have been grossly neglected.
At sixteen, he enrolled in the University of Leipzig, where he studied under the mystic Christian August Crusius, who was then head of the theological faculty. The boy varied the monotony of his studies by pranks which revealed his unbalanced character, including an attempt to raise spirits with the aid of Dr Faust's Höllenzwang.
After graduation, he lectured on biblical exegesis for a time as an adjunct to his father before becoming a catechist (Katechet) at the church of St Peter. He proved an eloquent and popular preacher and returned to the university as a visiting professor (professor extraordinarius) of biblical philology. He published a popular book of devotions, The Christian in Solitude, but was required to resign his positions and leave the Leipzig in 1768 on account of his irregular conduct.
Christian Adolph Klotz was then able to secure him the chair in biblical antiquities at the University of Erfurt. As the post was unpaid and Bahrdt was now married, he made his actual living as an inn-keeper and from private tutoring. Once he completed his doctorate of theology at Erlangen, he was able to persuade the faculty at Erfurt to appoint him professor designate of theology and began reading lectures. His orthodoxy had by this time completely vanished: Bahrdt was now an extreme rationalist and determined to popularize the position. He was not dismissed on this account, however, but left Erfurt in 1771 on account of his debts and the personal and professional quarrels he had become embroiled in with his colleagues.
He left for a post as professor of theology and preacher at the University of Giessen. His personal behavior was no less or more objectionable than elsewhere, but his publication of God's Recent Revelations in Letters and Stories (Neueste Offenbarungen Gottes in Briefen und Erzählungen) between 1773 and 1775 made plain his departure from official doctrine. The work—a "model version" of the New Testament in modern German—occasioned a memorably scornful attack on its poor taste by Goethe and prompted Bahrdt to again resign his position and relocate.
He then served as the director of the educational institution (philanthropin) established by Carl Ulisses von Salis-Marschlins at his château at Marschlins. It had languished since Martin Planta's death in 1772, but Bahrdt disliked the strict discipline maintained by Von Salis, resigned in 1777, and prompted the closing of the school.
Bahrdt next served as general superintendent at Dürkheim-on-the-Hardt at the invitation of the count of Leiningen-Dagsburg. He also attempted to establish a new school at Heidesheim. His luckless translation of the Bible followed him, however, and a 1778 decision of the Court Council of the Empire prohibited him from holding any professorial office, lecturing in any capacity, or publishing any work on theology. He again fled from his creditors and was imprisoned for a short period in Dienheim.