Born June 14, 1948 in San Francisco, California, Yep was the son of Thomas Gim Yep and Franche Lee Yep. Franche Lee, her familys youngest child, was born in Ohio and raised in West Virginia where her family owned a Chinese laundry. Yeps father, Thomas, was born in China and came to America at the age of ten where he lived, not in Chinatown, but with an Irish friend in a white neighborhood. After troubling times during the Depression, he was able to open a grocery store in an African-American neighborhood. Growing up in San Francisco, Yep felt alienated. He was in his own words his neighborhoods all-purpose Asian and did not feel he had a culture of his own. Joanne Ryder, a childrens book author, and Yep met and became friends during college while she was his editor. They later married and now live in San Francisco.

Although not living in Chinatown, Yep commuted to a parochial bilingual school there. Other students at the school, according to Yep, labeled him a dumbbell Chinese because he spoke only English. During high school he faced the white American culture for the first time. However, it was while attending high school that he started writing for a science fiction magazine, being paid one cent a word for his efforts. After two years at Marquette University, Yep transferred to the University of California at Santa Cruz where he graduated in 1970 with a B.A. He continued on to earn a Ph.D. in English from the State University of New York at Buffalo in 1975. Today as well as writing, he has taught writing and Asian American Studies at the University of California, Berkeley and Santa Barbara.