Khwaja Ahmad Abbas was born in Panipat, Haryana. He was born in the home of celebrated Urdu poet, 'Khwaja Altaf Husain Hali', a student of Mirza Ghalib. His grandfather Khwaja Gulam Abbas was one of the chief rebels of the 1857 Rebellion movement, and the first martyr of Panipat to be blown from the mouth of a cannon. Abbas's father Ghulam-Us-Sibtain graduated from Aligarh Muslim University, was a tutor of a prince and a prosperous businessman, who modernised the preparation of Unani medicines. Abbas's mother, 'Masroor Khatoon', was the daughter of Sajjad Husain, an enlightened educationist. Abbas took his early education in 'Hali Muslim High School', which was established by his great grand father Hali.
Abbas's family tree goes back to Aiyub Ansari, the companion of the Islamic prophet Muhammad. He was the grandson of Hali, the chief protégé of Urdu poet Ghalib.