Nayak was named after Swami Vivekananda (born Narendra Nath Datta). He has stated that seeing his father's business premises being repossessed by the bank and his father buying a lottery ticket on the advice of an astrologer to pay off the loan with the total confidence that it would get the first prize made him turn to rationalism. He married Asha Nayak, a lawyer in Mangaluru in a non-religious ceremony. Nayak started out working as a lecturer in the Department of biochemistry in the Kasturba Medical College in Mangalore in 1978. In 1982, he met Basava Premanand, a notable rationalist from Kerala, and was influenced by him.
Karnataka State Police withdrew his security wherein Nayak was quoted to say that it was an open invitation by forces to finish him.