Sunidhi Chauhan was born on 14 August 1983, in New Delhi, India in a Hindu Rajput family. Her father, Dushyant Kumar Chauhan, who is from Uttar Pradesh, is a theatre personality at the Shriram Bharatiya Kala Kendra. Her mother, a homemaker, influenced Sunidhi to pursue a career in music. She also has a younger sister. At the age of four, Chauhan started performing at competitions and local gatherings, subsequently convinced by her father's friends to take singing seriously. During that time, she was doing live shows and trained herself with "regular riyaaz by listening to cassettes and CDs of popular numbers".
Sunidhi Chauhan Story begins with her studies from Greenway Modern School and used to stay with her family members in Dilshad Garden, Delhi. She discontinued her studies right after schooling to pursue a career in the music industry. She said: "I quit because I did not feel like studying. I made the decision to pursue my dream as a singer and I don't regret it one bit".
When actress Tabassum spotted her, she made her sing live in her show Tabassum Hit Parade and asked her family to shift to Mumbai. She then introduced Chauhan to Kalyanji Virji Shah and Anandji Virji Shah. Upon meeting, Kalyanji changed her name from Nidhi to Sunidhi as he felt that it is a lucky name. When she was 11, her dad quit his job and brought her to Mumbai. Initially, the family had financial difficulties in adjusting life to the city. After that she worked in Kalyanji's academy for few years and became the lead singer in his "Little Wonders" troupe. She was then offered with many shows, though her father insisted on singing for films.