She was born as third child to Saraswatamma and Bommaraju Venkata Subbaiah, in Doddavaram village of Prakasam district, Andhra Pradesh. She grew up watching her father performing stage shows. Her father, Venkatasubbiah, was a staunch lover of classical music and gave her early training in music. Bhanumathi entered the film industry in 1935, and acted in over 200 films in Telugu and Tamil. She was also called as Ashtavadhani by the film industry people as she was a writer, actor, director, producer, singer, music director, editor and studio owner. She also had a good knowledge of Astrology and philosophy.
She made her debut in Telugu cinema in 1939 as Kalindi in Vara Vikrayam (Telugu), directed by C. Pullaiah. She had acted in Malathi Madhavam, Dharma Patni and Bhaktimala. Her first popular film was Krishna Prema. Her next popular film was Swargaseema, a milestone film in her career. She later acted in many memorable movies like Chakrapani, Laila Majnu, Vipranarayana, Malliswari, Batasari and Anthastulu. In 1953, she made her directorial debut with Chandirani (made simultaneously in Tamil, Telugu and Hindi). Her last film was made in 1998, entitled Pelli Kanuka. C. N. Annadurai gave her a title "Nadippukku Ilakkanam" (means Grammar for acting) that suits her aptly. Even veteran actors Sivaji Ganesan and the then Chief minister of Tamilnadu M.G.Ramachandran were afraid on the sets of her bold and prolific versatility.
For the movie Anthasthulu (1964), VB Rajendra Prasad had approached Bhanumati for the role of Akkineni Nageswara Rao’s sister. She liked the subject and agreed to do the film immediately. The crew booked a room in "Ritz-Carlton" in Hyderabad and she didn’t want to waste money, so she offered to stay at Sarathi Studios, which had an open area and snakes. The next morning she woke up with her nails bitten by rats. The director decided to cancel the shoot, VB Rajendra Prasad rushed to see Bhanumati applying iodine casually on the nails and asking when she could start work. While continuing with the shooting, she said, “If you cancel shoot for small things how will I be a Bhanumati (which means ‘shining like the sun’ in Sanskrit).
During the shooting of the film Krishna Prema, she met P. S. Ramakrishna Rao, an assistant director for that film. He was a film producer, director and editor of Telugu and Tamil Films. The couple later married on 8 August 1943 and later launched a popular production company, Bharani Pictures on their son's name.
Apart from being an exceptional actress, she was also a very talented musician. She is one of the fine actress of Telugu film industry. She was adept in both Carnatic and Hindustani music. She gave voice to her songs despite it being the norm to use playback singers for actors. Some of her songs are still popular like Pilichina biguvatara, Kila Kila Navvulu, Oh Pavurama, Preme Nerama. She also provided music to a lot of her films. During her later years she served on various movie related organizations. She was a Member of State Film Awards Committee for two years. She was also a Visiting Professor at the Film Institute for one year. She was Member of Children Film Society for 5 years, from 1965 to 1970.
Bhanumati was also a talented writer with a number of short stories to her credit. Her autobiography Nalo Nenu was published in Telugu and later, released in English as Musings. Andhra Pradesh Sahitya Academy awarded her as the best short story writer for her popular short stories "Attagari Kathalu". She was a Member of Lalit Kala Academy for 5 years, and Sahitya Academy, Andhra Pradesh for 10 years. She served as Director and Principal of the Tamil Nadu Government Music College, Chennai for three years. She was an eminent social worker who was closely associated with a number of Social Service Organizations. She was the founder member and treasurer of Madras branch of Altrusa International Inc., Chicago for lifelong starting from 1963. She was a life member of the 'Red Cross Society'. She established an educational institution named as "Dr. Bhanumathi Ramakrishna Matriculation School" at Saligramam, Chennai providing free education to the poor.