Dacko was born in the town of Bouchia in what was then the Federation of French Equatorial Africa. He was educated in Brazzaville and worked as a teacher before entering politics. During the years leading up to independence from France on 13 August 1960, he worked in close collaboration with his uncle Barthélémy Boganda, the country's founding father who served as the head of government in the transition period. Following Boganda's death in March 1959, Dacko assumed the leadership role and later, as president, oversaw the first six years of the Republic's independent existence.
He was removed from power in a coup d'état led by Jean-Bédel Bokassa, a cousin of his and chief of staff of the armed forces, on 1 January 1966. The new regime (which restyled itself the Central African Empire in 1977) kept Dacko under house arrest for several years. During this final phase of Bokassa's 13-year rule, however, Dacko was rehabilitated and appointed to serve as an advisor to President (later Emperor) Bokassa.
On 20 September 1979, with support from France, Dacko led a successful coup against Bokassa and was reinstated as president. In March 1981, he was re-elected to the presidency with a 50.23% share of the vote. One of his first actions under this new mandate was to declare a state of emergency – two opposition parties were dissolved, another was suspended, and some of their leaders were imprisoned – but this did not prevent him from being deposed in a 20 September 1981 coup.
Dacko made unsuccessful bids for the presidency in the elections of 1992 and 1999. He died at the age of 73 in Yaoundé, Cameroon, where he had gone for medical treatment.