Rabbi Yehuda bar Ilai, a Tanna of the fourth generation (2nd century), was born in Usha in the Galilee. He was the son and student of Rabbi Ilai, himself a disciple of Rabbi Eliezer, whose traditions he received through his father. As a child he studied in Lod under Rabbi Tarfon, whom he served devotedly, then under Rabbi Yishmael, and he became one of the foremost disciples of Rabbi Akiva.

He was one of the five students ordained by Rabbi Yehuda ben Bava, who paid for this act with his life, at a time when the Romans forbade semichah. During the Hadrianic persecutions he had to flee Usha and hide. When the decrees were lifted, Rabbi Akiva's disciples gathered in Usha and he was given the right to speak first. The Talmud (Shabbat 33b) relates that after he praised the works of the Romans, they appointed him "first of the speakers in every place," and he served as halachic authority in the house of the Nasi, Rabban Shimon ben Gamliel.

He is the sage most frequently cited in the Mishnah, where he is called simply "Rabbi Yehuda," and the Talmud teaches that anonymous passages of the Sifra are his. Rabbi Yochanan ruled that in his disputes with Rabbi Meir or Rabbi Shimon, the halachah follows Rabbi Yehuda. He followed the school of Rabbi Akiva and favored deriving halachah from the verses themselves.

He lived in great poverty: he and his wife shared a single cloak, and he refused all assistance. He insisted on combining Torah with labor, saying "Great is labor, for it honors the one who performs it," and "He who does not teach his son a trade teaches him brigandage." The Talmud relates that he would interrupt his study to escort the dead and to gladden brides, dancing before them with a myrtle branch, and that when the Talmud speaks of "a certain chasid," it refers to him or to Rabbi Yehuda ben Bava.

He lived to an old age, outliving his teachers and colleagues; Rabbi Yehuda HaNasi was among the disciples who paid him the last honors. His tomb is venerated at Ein Zeitim near Safed, where travelers mention it from the late 13th century and where the kabbalists of Safed, such as Rabbi Shlomo Alkabetz, the Ramak and the Arizal, came to study. People come there today to pray for livelihood. His hillula is observed on 14 Iyar.