Simon Bailey was born in Halifax, West Yorkshire. His father, the Reverend Walter Bailey, was a Baptist minister who combined conservative evangelical theological convictions with social radicalism. The family moved first to Birkenhead and then to Stoke-on-Trent, following Walter Bailey as he was called to different churches. Eventually he became so idiosyncratic that he ran his own church from home.
Simon Bailey continued his education at Regent's Park College, the Baptist Permanent Private Hall of the University of Oxford, where he read English Language and Literature under John F. Kiteley (himself once the pupil of J. R. R. Tolkien). He gained a First Class degree.
Despite having chosen to study at the Baptist Regent's Park, Simon Bailey was by now unhappy in the Baptist tradition. He received the sacrament of confirmation in the Church of England, embracing Anglicanism as more "aesthetic and sensual".
After Oxford, Simon Bailey studied theology at Emmanuel College, Cambridge, and was influenced by the writer and religious philosopher Don Cupitt, Fellow and erstwhile Dean of the College. Bailey subsequently did his theological training for the Ministry at Westcott House, Cambridge.
Simon Bailey's first experience of pastoral work was as a curate in the parish of Norton, Sheffield, where he stayed four years. A major event for the parish and the wider community, conceived and executed by Simon Bailey, was a large-scale community venture involving the production and performance of a play written and directed by him. It built on the mediaeval tradition of mystery and miracle plays, and was performed with dancing, acting and music in the churchyard of the ancient parish church of St. James.
Simon Bailey was inducted as Rector of St. Leonard's parish church, Dinnington in South Yorkshire in December 1985. Dinnington was a South Yorkshire mining community, whose colliery closed in 1991.
Simon Bailey was a gay man and contracted HIV from a sexual partner. He learned that he had the virus only a month before his induction as Rector of Dinnington. For several years he worked in the parish without obvious symptoms, but when he became too unwell to conceal his condition from the people around him he informed the diocesan authorities and from 1992 on, gradually introduced the news to his own parishioners.
Though not the only Anglican priest at that time to be HIV-positive, and eventually to develop AIDS, he was the first to stay in parish ministry, continuing to celebrate the Eucharist until only a few weeks before his death. One of the most remarkable features of his time at Dinnington was the love and care that he received from his parishioners.
Simon Bailey's literary influences were varied. He was particularly interested in the poetry of R. S. Thomas and of John Milton, whose blindness Bailey identified with his own illnesses. He himself acknowledged that the Miracle Play he wrote for Norton owed a debt to Christopher Fry.
His spirituality was very much inspired by Celtic Christianity, its holy places and saints. Among the sacred places most important to him was the small island of Bardsey, off the coast of Wales, which had been a great centre of pilgrimage in the Middle Ages. It became a place he returned to often. He also acquired a significant collection of icons. Bailey was a strong advocate of women priests and an active member of the Ministry for the Ordination of Women (MOW). He also became involved in the Campaign for Nuclear Disarmament.