He was born to pious parents in Tarsia in Bithynia. At the age of twenty he entered monastic life at the Monastery of Agaures near his home. There he became a model of prayer, ascesis and zeal for holiness — he possessed nothing but the cloak he wore, and did not even have his own cell, choosing instead to sleep on the bare ground. When he slept he would not lie on his back or his left side, but always on his right side. In church, he stood repeating 'Lord, have mercy!' to himself throughout the services. He was ordained to the priesthood, and in time was made abbot of the community. But just at that time, Leo the Armenian became Emperor and revived the iconoclast heresy. The monks of Agaures, who held to the Orthodox Faith, scattered to caves and forests to escape persecution. Eustratius himself was imprisoned for a time, and was only able to re-gather the community and resume its direction when Leo died and Orthodoxy was restored in 842.

As abbot, Eustratius continued to live as the humblest of the brethren, spending the day sharing in their manual labor, and most of the night in prayer and prostrations. He often traveled among the dependencies of his large monastery to offer counsel and encouragement to the brethren. While traveling he would often give his coat or even his horse to anyone in need whom he met on the way. Once he gave the monastery's only ox to a peasant who had lost his own. Once, on a visit to Constantinople, he was given a large sum of money by the Emperor for the monastery; on the way back he distributed all of it to the poor. Once, on the road, he met a man who had despaired because of his sins and was about to hang himself. The Saint took the man's hand and said 'My child, may the weight of your sins lie on me from now on. On the day of Judgment, I will answer for them instead of you. Only throw away this rope and hope in God.'

During his own life, Saint Eustratius performed countless miracles by his prayers: healing the sick, quenching fires, raising the dead. He reposed in peace in Constantinople at the age of ninety-five, having spent seventy-five years in monastic life.