Born Sebastián Moyano in the province of Córdoba, Spain in 1479 (1480?). Took the name Benalcázar or Belalcázar as that was the name of castle-town nearest to his birthplace in Córdoba. According to various sources, may have left for the New World with Columbus as early as 1498, but José de Castellanos wrote that he killed a mule in 1507, and fled Spain for the West Indies due to fear of punishment, and as a chance to escape the poverty in which he lived.

What is known for certain is that he entered Nicaragua with Hernandez de Córdoba in 1524, and became the first mayor of the city of León. He remained there until 1527, when he left for Honduras as a result of internal dispute among the Spanish governors. Briefly returning to León, he sailed to the coast of Peru, where he united with the expedition of Francisco Pizarro in 1532. In 1534, after having helped Pizarro battle native tribes, he set off to conquer the valley of Quito in Ecuador, using funds obtained as compensation from his previous campaigns. Founded the city of Quito with Diego de Almagro, honoring Pizarro by naming it in full San Francisco de Quito.

Moving northward into present day Colombia in search of El Dorado in 1535, entered the Cauca River Valley, founding the southwestern Colombian cities of Pasto, Popayán (next in importance after Quito) and Santiago de Cali in 1536.

Crossing overland to the Magdalena River Valley, he entered the highlands of central Colombia with Gonzalo Jiménez de Quesada and Nicolas Federmann, a German, in 1539. Carlos the Fifth grants Belalcázar the governorshiop of Popayán and an honorary title (adelantado) in May 1540. As so often happened amongst the conquistadores, land squabbles developed between Belalcazár and a neighboring province governed by Pascual de Andagoya. Belalcázar succesfully defended his lands, and took over some of Andagoya. He then intervined in a disagreement between supporters of the families of Pizarro and Almagro in Peru. In 1546, he ordered the execution of Jorge Robledo, who governed a neighboring province in yet another land vendetta. He is put to trial in abesentia in 1550, convicted and condemned to death for the death of Robledo, and other offenses pertaining to his constant involvement in the various wars between conquistadores. A victim of his own ambition, he died before he could begin the voyage back to Spain to appeal the decision, in Cartagena, Colombia.