When his father Andronikos IV usurped the throne from his father John V Palaiologos in 1376, John VII was associated as co-emperor. Both father and son were overthrown and partly blinded in 1379, but Andronikos IV kept his imperial status and was granted Selymbria (Silivri) as his domain by John V. When Andronikos IV died in 1385, John VII perhaps succeeded to his father's position.
On April 14, 1390 John VII Palaiologos ousted to his grandfather John V and maintained himself on the throne for five months, until John V was restored by his son Manuel with the help of the Republic of Venice
John VII sought refuge with Bayezid I of the Ottoman Empire on September 17, 1390. Bayezid confirmed John VII in his father's domain of Selymbria, and relations improved with Manuel II, who may have recognized John VII as his intended heir (at that time his own sons were not yet born).
In 1399, after Bayezid I had been besieging Constantinople for some five years, Manuel II left to ask for military aid in Western Europe and left John VII as Regent to defend the capital. John VII discharged his duties well, hoping for a miracle, which occurred when Bayezid was defeated by Timur at the Battle of Ankara (July 20, 1402).
The defeat was followed by a civil war in the Ottoman Empire, as rival Ottoman princes sought peace and friendship with the Byzantine Empire. Taking advantage of this time of Ottoman weakness, John VII entered into a treaty that secured the return of much of the Turkish-occupied coast on the European side of the Sea of Marmara, with a special concession of the city of Thessalonica on the Aegean Sea. Thessalonica had been governed by Manuel II before its conquest by the Turks. On Manuel II's return John VII dutifully returned power to him and was allowed to retire to Thessalonica, which he governed for the rest of his life (1403–1408). John VII was allowed to keep the title of emperor (Basileus), and he associated his own young son, Andronikos V (born about 1400), with him at an uncertain date, but Andronikos V predeceased his father in 1407.