John Arrillaga is one of five children born into a lower-middle-class home with his mother, Freida, and father, Gabriel, who traced his roots to the Basque region. He attended Morningside High School in Inglewood, California, and graduated in 1955. He attended Stanford University on a basketball scholarship, and was a first-team All-AAWU selection in 1960. He was a member of Delta Tau Delta, and graduated in 1960 with a bachelor’s degree in geography .

In 1968, Arrillaga married Frances Marion Cook Arrillaga, a teacher and librarian. She died on October 13, 1995, in her Palo Alto home of lung cancer at age 54. They had two children together, John Jr. and Laura. Their daughter Laura Arrillaga-Andreessen is married to Marc Andreessen, who co-authored the Mosaic and Netscape web browsers, and is co-founder of several web technology enterprises. His son John Arrillaga, Jr. is married to Justine Stamen Arrillaga, founder of the TEAK Fellowship.

In 2006, he sold 5,300,000 sq ft (490,000 m) of his real estate holdings for roughly $1.1 billion.

Arrillaga is known for his support of Stanford University. The alumni center, the Frances C. Arrillaga Building, is named in memory of his first wife, and other athletic facilities carry his surname. In May 2006, Arrillaga gave $100 million to Stanford.

In June 2013, he donated $151 million to Stanford, the largest individual donation from a living donor in the university’s history.

In 2020, he ranked No. 339 on the Forbes 400 list of the richest people in America. In October 2020, his net worth was $2.5 billion.