Dousmanis was born in Corfu in 1868, the descendant of a noble family. He enlisted in the Naval Academy, graduating in 1888. He saw action during the Balkan Wars of 1912 - 1913, commanding the flagship of the Hellenic Navy, the Greek cruiser Georgios Averof. He was promoted to Rear-Admiral in 1914, in recognition of his services and was appointed Governor of the Warships Squadron.
Dousmanis served as the Head of the Navy General Staff from June 1915 to 1917, however, after Eleftherios Venizelos prevailed in the "Great Divide" of 1917, Dousmanis - a royalist - was dismissed from military duties and exiled to Santorini. After the elections of November 1920 and the return of King Constantine I and the royalists to power, he was reinstated serving as Commander of the Aegean Fleet (January - April 1921) and, once more, as Head of the Navy General Staff (November 1921 -October 1922). He retired with the rank of Vice-Admiral in January 1923.
In 1939, Sophocles Dousmanis co-authored the book "The Diary of the Commander of G. Averof during the Wars of 1912-1913", describing his role in the Naval Battle of Elli (December 1912) and the Naval Battle of Lemnos (January 1913).