With the adoption of the title of emperor by Liu Bang, Liu Pi was given the title of Marquis of Pei 沛侯. He participated in the war against the rebellion of Ying Bu 英布. In 195 he was made Prince of Wu, a kingdom that he peacefully ruled for several decades during the reigns of Emperor Hui 漢惠帝 (r. 195-188) and Empress Dowager Lü 呂太后 (r. 188-180).
He had his own money cast and was able to create high revenues by the state monopoly on salt production and marketization. He had thus gained the status of a quasi independent ruler that he wanted to test during the reign of Emperor Jing 漢景帝 (r. 157-141 BCE). Already at an earlier point of time rifts had opened between him and Crown Prince Liu Qi 劉啟, the future Emperor Jing, because Liu Qi had killed Liu Pi's son during a chess contest.
In 154 BCE Emperor Jing adopted the suggestion of Censor-in-chief (yushi dafu 御史大夫) Chao Cuo 晁錯 to cut down the seize of the princedoms in order to curtail their economical – and political – power. Liu Pi, in fear for his independence, allied with the princes of Chu 楚, Zhao 趙, Jiaodong 膠東, Jiaoxi 膠西, Jinan 濟南 and Zichuan 淄川 and began the so-called rebellion of the Seven Princes (Wu-Chu qiguo zhi luan 吳楚七國之亂). The rebellion was suppressed mainly by the armies under general Zhou Yafu 周亞夫.
Liu Pi fled to the east cost, where he was killed.