Peucestas was born in the Macedonian town Mieza (modern Naousa) as the son of an otherwise unknown Alexander. The stages of his early career are unknown to us and it is possible that he joined Alexander at a later stage of his campaign. However this may be, Peucestas was present during the return from the Punjab, which started in the summer of 326.
In a valuable document (quoted here), he is mentioned as one of the thirty-three trierarchs of the fleet that Alexander had built to ship his men to the Indian Ocean. The word "trierarch" means "captain" but it seems that something more important was meant in the present case, because all members of Alexander's inner circle are mentioned as trierarchs. This makes it clear that Peucestas was an important member of the royal court, and since he did nothing special during the earlier campaigns, we may assume that he was a member of the highest Macedonian nobility. Perhaps he was a younger youth friend of the Macedonian crown prince.
The nations along the Indus offered resistance against Alexander's navy and army. In January 325, the Macedonians had to fight themselves a way through the country of the Mallians (Indian Mâlava). During the siege of their capital, modern Multan, Alexander was seriously wounded. He owed his survival to Leonnatus, Abreas and Peucestas, who protected the king with a sacred shield that Alexander had taken away from Troy.
One year later, Peucestas was rewarded with a golden diadem. This was an exceptionally high honor, because only three others received this sign of esteem (text). He was also appointed satrap of the heartland of the former Achaemenid empire, Persis. In this quality, he commanded a company of Persian soldiers that were to replace the Macedonian veterans (early 323).
Peucestas was still one of the members of Alexander inner when the great conqueror died: he was present at the drinking party of Medius that was to be Alexander's last supper, and he slept in the temple of Serapis, hoping to receive in his dreams instructions about the cure of the king (go here for the text about and a discussion of this incident).
In the confused period of the Diadochi, which began with the death of Alexander (June 11, 323), Peucestas remained satrap of Persis. Both Perdiccas and Antipater, who served as regents for Alexander's brother Arridaeus, reinvested him in his function (at the settlements of Babylon in June 323 and Triparadisus). It must have been difficult to ignore him, because he was the only Macedonian who had taken the trouble to learn the Persian language.
In 317, one of Alexander's successors, Peithon the satrap of Media, tried to subdue the leaders of the eastern provinces. Peucestas and the other satraps united and offered resistance. Their common army was still at Susa when Eumenes arrived, the former secretary of Alexander. The regent Polyperchon had appointed him as commander of an army in Asia that had to resist Antigonus Monophthalmus, a general with plans identical to Peithon's.
Peucestas wanted to remain neutral, but was forced to join Eumenes' army. After all, Eumenes was still fighting for the sake of the Macedonian royal house. Antigonus and Eumenes joined battle in Paraetacene (near modern Esfahân), but the engagement remained undecided. In the spring of 316, a second battle was fought in the district of Gabiene (near Susa). Peucestas, who was an unwilling ally of Eumenes, deliberately retreated from the battle field, which gave Antigonus an opportunity to defeat his enemy.
After the battle, Peucestas surrendered to Antigonus, but he was not reinstated. Peucestas' later career is unknown, but is seems that he survived Antigonus and was one of the favorites of his son Demetrius.
Peucestas is not to be confused with his namesake, a military commander of Egypt.