Born in Lahore on February 3, 1882, F.H.M. Bailey was the son of an officer in the British Army (who was also named Frederick, resulting in the younger Bailey usually being called just Eric). He studied in Sandhurst before returning to India as a member of the 32nd Sikh Pioneers. During a mission in Sikhim he began to study Tibetan, and became so proficient that he accompanied Francis Younghusband in his 1904 invasion of Tibet.
He later traveled in unknown parts of China and Tibet, eventually earning the Gold Explorer's Medal from the Royal Geographical Society for his discoveries. He also contributed notes on big-game to the Journal of the Bombay Natural History Society.
Bailey served on the western front during World War I, where he was shot in the arm. At the time he was serving in the Indian Expeditionary Forces as one of the few Urdu-speaking officers on the front. When his wound continued to worsen, he returned to England, but later joined the fight again at Gallipoli, where he was wounded twice more.
Having heard about rumours of a large waterfall, Bailey transferred himself from the Indian Army to the Political Department to get appointments on the Tibetan frontier. In 1911-12 he made an unauthorized exploration to the Tsangpo Gorges with Captain Henry Morshead of the Survey of India . Morshead was later a surveyor for the 1921 Reconnaissance of Mount Everest along with Sir George Leigh-Mallory. Their adventures led them to the Rong Chu valley a gorge on the upper Tsangpo. It was in this valley that Bailey spotted a tall blue poppy at the margin of the forest and pressed it in his notebook - now called Meconopsis baileyi. They got to Kintup's falls at the monastery of Pemakochung and were greatly disappointed to find the falls to be about thirty feet.
One of Bailey's more well-known adventures occurred in 1918, when he traveled to Tashkent in Central Asia on a mission to discover the intentions of the new Bolshevik government, specifically in relation to India. During this mission he also shadowed Raja Mahendra Pratap, an Indian nationalist who had established the Provisional Government of India in Kabul in 1915. Pratap was at the time liaising with Germany and Bolshevik authorities for a joint Soviet-German assault into India through Afghanistan. It was at this time that the first plans for the Soviet Kalmyk Project was first considered. Bailey eventually had to flee for his life from the city, and only escaped after taking on the guise of an Austrian POW and joining the Cheka, with an assignment to find a rogue British agent - that is, himself. Upon his return to England, he was a national hero. Bailey later recorded his exploits in his book Mission to Tashkent. He was also instrumental in organising support for the Basmachi Revolt.
He helped Frank Kingdon-Ward and Lord Cawdor in 1924 when he was a Political Officer in Gangtok, Sikkim. Bailey arranged passports and encouraged them to search the fifty-mile unexplored gap of the river to solve the riddles of the Tsangpo Gorges. Kingdon-Ward wrote a book by the same name documenting that expedition.