Born at the Ducal Palace of Modena, he was the only son of the third marriage of Francesco I d'Este, Duke of Modena. His mother was Lucrezia Barberini, daughter of Taddeo Barberini and Anna Colonna.
Created cardinal on 2 September 1686, he left the ecclesiastical career in 1694 to succeed his nephew Francesco II as duke. He married Princess Charlotte Felicitas of Brunswick-Lüneburg (1671–1710), eldest daughter of Johann Friedrich, Duke of Brunswick-Lüneburg and Benedicta Henrietta of the Palatinate. He hoped that this marriage to a German princess would provide him needed support from the various German royal houses, including the Habsburgs, who were connected to his wife by blood.
Rinaldo married Charlotte in Modena on 11 February 1696. Rinaldo wanted to encourage relations between Modena and Brunswick, whose ruling house was the House of Hanover. The marriage was celebrated splendidly despite financial problems in Modena; the artist Marcantonio Franceschini was commissioned to paint a room, the Salone d'onore at the ducal palace in honour of the marriage.
Charlotte died at the Ducal Palace of Modena after giving birth to a daughter in September 1710. The child also died. She was buried at the Church of San Vincenzo in Modena. Her son succeeded as Duke of Modena in 1737.
His first move as duke was to reduce the price of the grain and to improve the conditions of life of the peasants.
At the outbreak of the War of Spanish Succession (1702) he declared neutrality, but this did not prevent the French troops from capturing Modena. The Duke was forced to flee to Bologna. In 1707, after a long siege in which Rinaldo took part, German troops ousted the French from his capital. In the resulting peace treaty, Rinaldo acquired the Duchy of Mirandola, but lost Comacchio. In 1721, he attempted to establish friendlier relationship with France by marrying his son Francesco with Charlotte Aglaé d'Orléans, the daughter of Philippe d'Orléans, Duke of Orléans, the Regent of France during the childhood of King Louis XV. Charlotte Aglaé received an enormous dowry of 1.8 million livres, half of which was contributed in the name of the young king, Louis XV, on orders of the Regent. From her adopted country, Charlote Aglaé received a trousseau consisting of diamonds and portraits of her future husband. However, the marriage proved troublesome, mainly due to his new daughter-in-law's licentious behaviour.
In order to keep peace at court, Rinaldo had to build a separate residence for them in
RivaltaReggio Emilia. He also failed in an attempt to obtain the Duchy of Parma through the marriage of his daughter, Enrichetta, with Antonio Farnese, Duke of Parma. When the duke died without an heir, Elisabeth Farnese, the Queen of Spain, acquired the duchy for her son, Charles III of Spain, a member of the House of Bourbon.
In 1733 the War of Polish Succession began. Rinaldo, though nominally neutral, sided secretly for Austria. Again French troops forced him to move to Bologna, but a peace in 1736 was again favourable for the Este, who obtained the county of Novellara and Bagnolo.
Rinaldo was succeeded by his son Francesco.