Originally a wig-maker in Edinburgh, Ramsay gave that up for bookselling. He founded what is thought to have been the first circulating library in Britain. He published his collected poems a few years later. His best known work, The Gentle Shepherd, on a pastoral theme, had instant success.
Ramsay is said to have been the most amiable of men and a great conversationalist. Always interested in the theatre, he opened a playhouse in Carrubber's Close, but it was closed down by the Town Council. Ramsay built an octagonal home, the "Goose-pie", which still stands at Ramsay Garden, Castlehill, near the top of the Royal Mile.
Ramsay is buried in Greyfriars Churchyard. His marble statue stands at the junction of Princes Street with the Mound; the medallion portraits around the pedestal are members of his family and descendants.