Marsuppini was born in Genoa into a family from Arezzo, but grew up and died in Florence. His father, Gregorio Marsuppini, had been governor of Genoa under Charles VI of France. He had close contact with the Medici family. In 1444, he followed Leonardo Bruni as chancellor of the Republic of Florence, with whom he shares the honour of a monument in Santa Croce (designed by the sculptor Desiderio da Settignano). Poggio Bracciolini became chancellor after Carlo's death.
Upon the death of his father Gregorio (1444) Carlo commissioned Filippo Lippi the Coronation of the Virgin, with St. John and St. Benedict (called Marsuppini Coronation, now in Rome, Pinacoteca Vaticana) for the Olivetan Convent at Arezzo.
He was a man of great culture, the author of letters and some poems. Among his works: a Consolatio of noteworthy Christian inspiration (which contrasts with his reputation for unbelief) upon the death of Contessina de' Bardi, addressed to her husband Cosimo dei Medici and her son Lorenzo. Pope Nicholas V instructed him in 1452 to translate Homer's Iliad into Latin; however he died with much of the work incomplete. There also remain some "belles-lettres" in the Humanist genre, such as a translation of the Batracomyomachia, and solemn Latin poetry.
Two sons of Carlo Marsuppini, Cristoforo and Carlo (junior) appear as characters in the Commentarium in Convivium Platonis de Amore (“Commentary on Plato’s Symposium”) by Marsilio Ficino.