Michael Bruno was born in Hamburg, Germany in 1932 and immigrated to Eretz Yisrael (Mandatory Palestine)  with his family when he was one year old. He began his studies at the Hebrew University in Mathematics and later completed his undergraduate and master's studies in mathematics and economics at the University of Cambridge. He received a Ph.D. in economics from Stanford University in 1962 and joined the faculty of the Department of Economics at the Hebrew University in 1963. Bruno served as Head of the Department from 1968 to 1970 and as Director of the Falk Institute for Economic Research in Israel from 1972 to 1975. He was one of the architects of the 1985 stabilization plan, which successfully curtailed the hyperinflation that plagued the Israeli economy during the late 1970s and mid-1980s. He was member of the Israel Academy of Sciences and Humanities since 1975,  Fellow and President of the Econometric Society, Fellow of the American Academy of Arts and Sciences, and Honorary Fellow of the American Economic Association. In addition, he served as President of the International Economic Association and was the second President of the Israel Economic Association. He served as Governor of the Bank of Israel from 1986 to 1991 and as Chief Economist of the World Bank from 1993 to 1996. Bruno was awarded the Rothschild Prize in Social Sciences in 1974 and the Israel Prize in Economics in 1994.

His research interests included: economic development and international trade; economic growth and productivity; income distribution, taxation and transfers; inflationary processes and stagflation; macroeconomic stabilization policy in comparative Perspective, with particular emphasis on Israel.

Michael Bruno passed away in Jerusalem in 1996. Following his death, the Yad Hanadiv Foundation established the annual Michael Bruno Memorial Award, which has been awarded since 1999 to exceptional Israeli researchers under the age of 50 who demonstrate extraordinary talent and creativity and are recognized as having the potential for significant breakthroughs in their fields. Since 2012, the Israel Institute for Advanced Studies at the Hebrew University has been responsible for selecting and awarding the Michael Bruno Award.