Montgomery made her television debut in her father's series Robert Montgomery Presents, and her film debut in 1955 in The Court Martial of Billy Mitchell. Her early career consisted of starring vehicles and appearances in live television dramas and series, such as Studio One, Kraft Television Theater, The Twilight Zone, and Alfred Hitchcock Presents. In 1954 she lost out on co-starring with Marlon Brando in the seminal film On the Waterfront directed by Elia Kazan. Kazan in his autobiography says that although Montgomery tested well in the role, she had an air of "finishing school" that troubled him.

She was also featured in a role as a socialite with Henry Silva and Sammy Davis, Jr in the offbeat 1963 gangster film Johnny Cool and, the same year, with Dean Martinand Carol Burnettin the motion picture comedy Who's Been Sleeping In My Bed?, directed by Daniel Mann. Nevertheless, Alfred Hitchcock had her in mind to play the sister-in-law of Sean Connery, who sees herself as a rival to the troubled heroine in the movie Marnie, but Montgomery was unavailable owing to her commitment to a new television show: Bewitched

Montgomery received five Emmy Award and four Golden Globe nominations for her role. At its creative peak, Bewitched was considered one of the most sophisticated sitcoms on the air and cleverly explored contemporary themes and social issues within a fantasy context.

Montgomery was first married to New York socialite Frederick Gallatin Cammann in 1954; the marriage lasted barely a year. She was married to actor Gig Young from 1956 to 1963, and then to Bewitched producer William Asher from 1963 to 1973, with whom she had three children: William Asher (July 24, 1964), Robert Asher (October 5, 1965) and Rebecca Asher (June 17, 1969). The latter two pregnancies were incorporated into Bewitched as Samantha's pregnancies with Tabitha and Adam Stephens. After cohabiting for nearly twenty years, she entered her fourth and final marriage, to actor Robert Foxworth, in 1993. She even approached comedian Dennis Miller about taking out a license to marry the couple. She remained married to Foxworth until her death.

Montgomery was diagnosed with colorectal cancer in the spring of 1995. She had ignored the flu-like symptoms during the filming of Deadline for Murder: From the Files of Edna Buchanan, but acted too late. Unwilling to die in a hospital, and with no hope of recovery, she elected to return to her Beverly Hills home that she shared with Foxworth. She died there, in the company of her children and husband, on May 18, 1995, at age 62, only eight weeks after her diagnosis.