Coming from a political family, he is the son of former Taoiseach Liam Cosgrave and grandson of the first President of the Executive Council of the Irish Free State W. T. Cosgrave. He is married to the daughter of former Chief Justice and 1950's Fine Gael Health Minister Thomas F. O'Higgins.
He was elected to Dáil Éireann at the 1981 general election as Teachta Dála for the Dún Laoghaire and re-elected at the February 1982 and November 1982 general elections. He lost his seat at the 1987 general election, and was unsuccessful again at the 1989 and 1992 general elections.
In 1993 he was elected to Seanad Éireann on the Industrial and Commercial Panel, serving as Cathaoirleach, and was re-elected in 1997 to the 21st Seanad. Cosgrave was a member of the Presidential Commission (acting head of state) from 12 September 1997 to 17 September 1997. At the 2002 general election he was again an unsuccessful candidate for the Dáil in Dún Laoghaire, and he did not contest the Seanad elections of that year.
In 2003, The Mahon Tribunal, set up to investigate allegations of corruption among Irish politicians, heard that Cosgrave had accepted illegal payments from property developers in return for voting to rezone property in Dublin. He resigned from the Fine Gael party when this became known, thereby effectively ending his political career.
On 17 October 2005, Cosgrave pleaded guilty to a charge of failing to disclose to the Standards in Public Office Commission a political donation of £2,500 received from lobbyist Frank Dunlop in the course of the 1997 general election. He was sentenced on 26th May 2006 to perform 75 hours of community service in lieu of a 6-month custodial sentence.
He told the Tribunal that his decision to support the rezoning was not a U-turn in return for a political donation. But he could not recall the reason for his decision. He said he could not recollect whether he had received any donations from Monarch, or other developers at this time. But there could have been some.