James Franck was born in Hamburg, Germany, on 26 August 1882, into a Jewish family, the second child and first son of Jacob Franck, a banker, and his wife Rebecca née Nachum Drucker. He had an older sister, Paula, and a younger brother, Robert Bernard. His father was a devout and religious man, while his mother came from a family of rabbis. Franck attended primary school in Hamburg. Starting in 1891 he attended the Wilhelm-Gymnasium, which was then a boys-only school.
Hamburg had no university then, so prospective students had to attend one of the 22 universities elsewhere in Germany. Intending to study law and economics, Franck entered the University of Heidelberg in 1901, as it had a renowned law school. He attended lectures on law, but was far more interested in those on science. While there, he met Max Born, who would become a lifelong friend. With Born's help, he was able to persuade his parents to allow him to switch to studying physics and chemistry. Franck attended mathematics lectures by Leo Königsberger and Georg Cantor, but Heidelberg was not strong on the physical sciences, so he decided to go to the Frederick William University in Berlin.
At Berlin, Franck attended lectures by Max Planck and Emil Warburg. On 28 July 1904 he saved a pair of children from drowning in the Spree River. For his Doctor of Philosophy (Dir. Phil.) under Warburgs supervision, Warburg suggested that he study corona discharges. Franck found this topic too complex, so he changed the focus of his thesis. Entitled Über die Beweglichkeit der Ladungsträger der Spitzenentladung ("On the Mobility of Ions"), it would subsequently be published in the Annalen der Physik'.
With his thesis completed, Franck had to perform his deferred military service. He was called up on 1 October 1906 and joined the 1st Telegraph Battalion. He suffered a minor horse riding accident in December and was discharged as unfit for duty. He took up an assistantship at the Physikalische Verein in Frankfurt in 1907, but did not enjoy it, and soon returned to Frederick William University. At a concert Franck met Ingrid Josephson, a Swedish pianist. They were married in a Swedish ceremony in Gothenburg on 23 December 1907. They had two daughters, Dagmar (Daggie), who was born in 1909, and Elisabeth (Lisa), who was born in 1912.
To pursue an academic career in Germany, having a doctorate was not enough; one needed a venia legendi, or habilitation. This could be achieved with either another major thesis or by producing a substantial body of published work. Franck chose the latter route. There were many unsolved problems in physics at the time, and by 1914 he had published 34 articles. He was the sole author of some, but generally preferred working in collaboration with Eva von Bahr, Lise Meitner, Robert Pohl, , Robert W. Wood, Arthur Wehnelt or Wilhelm Westphal. His most fruitful collaboration was with Gustav Hertz, with whom he wrote 19 articles. He received his habilitation on 20 May 1911.