Redgrave was born in London, the daughter of actors Sir Michael Redgrave and Rachel Kempson. Laurence Olivier announced her birth to the audience for a performance of Hamlet at the Old Vic, when he told them that Laertes played by Sir Michael had a daughter. She was educated at The Alice Ottley School in Worcester. Her siblings, Lynn Redgrave and the equally outspoken Corin Redgrave, are also acclaimed actors. Redgrave's daughters, Natasha Richardson and Joely Richardson (by her 1962–1967 marriage to film director Tony Richardson) have also built respected acting careers. Redgrave's son Carlo Nero (né Carlo Sparanero), by her relationship with Italian actor Franco Nero (né Francesco Sparanero), is a writer and film director. She met Nero while filming Camelot in 1967, the year in which she divorced her husband Tony Richardson.

In 1967, Redgrave was made a Commander (CBE) of the Order of the British Empire. It is understood that she declined a damehood (DBE) in 1999.

During the late 1970s and 1980s, she had a long-term relationship with actor Timothy Dalton.

Vanessa Redgrave entered the London School of Speech and Drama in 1954. She first appeared in the West end, playing opposite her brother, in 1958.

In 1960, Redgrave had her first starring role in Robert Bolt's The Tiger and the Horse, in which she co-starred with her father. In 1962 she played Imogen in William Gaskill's production of Cymbeline for the Royal Shakespeare Company. In 1966 Redgrave created the role of Jean Brodie in the Donald Albery production of The Prime of Miss Jean Brodie, adapted for the stage by Jay Presson Allen from the novel by Muriel Spark. She won four Best Actress Evening Standards Awards for Best Actress in four decades. She was awarded the Laurence Olivier Award for Best Actress in a Revival in 1984 for The Aspern Papers.

In the nineties, her theatre work included Prospero in The Tempest at Shakespeare's Globe in London. In 2003 she won a Tony Award for Best Actress in a Play for her performance in the Broadway revival of Eugene O'Neill's Long Day's Journey Into Night. In January 2006, Redgrave was presented the Ibsen Centennial Award for her "outstanding work in interpreting many of Henrik Ibsen's works over the last decades."

In 2007, Redgrave played Joan Didion in Didion's Broadway stage adaptation of her recent book, The Year of Magical Thinking. For this, she was nominated for a Tony Award in the category of Best Leading Actress in a Play.

Highlights of Vanessa Redgrave's early film career include her first starring role in Morgan: A Suitable Case for Treatment (for which she earned an Oscar nomination, a Cannes award, a Golden Globe nomination and a BAFTA Film Award nomination); her portrayal of the cool London swinger, Jane, in 1966’s Blowup; her spirited portrayal of dancer Isadora Duncan in Isadora (for which she won a National Society of Film Critics Award for Best Actress, a second Prize for the Best Female Performance at the Cannes film festival, along with a Golden Globe and Oscar nomination in 1969); and various portrayals of historical figures - ranging from Andromache in The Trojan Women, to Mary of Scotland in Mary, Queen of Scots.

In 1977, Redgrave funded and narrated a documentary film The Palestinian, which focused on the plight of the Palestinian people. That same year she starred in the film Julia, about a woman murdered by the Nazi regime in the years prior to World War II.

Redgrave's performance in Julia garnered an Academy Award for Best Supporting Actress. However, members of the Jewish Defense League (JDL), led by Rabbi Meir Kahane, burned effigies of Redgrave and picketed the awards ceremony in the spring of 1978 to protest against both Redgrave and her support of the Palestinian cause.

Later film roles of note include those of suffragette Olive Chancellor in The Bostonians (1984, a fourth Best Actress Academy Award nomination), transsexual Renée Richards in Second Serve (1986); Mrs. Wilcox in Howards End (1992, her sixth Academy Award nomination, this time in a supporting role); crime boss Max in Mission: Impossible; Oscar Wilde’s mother in Wilde (1997); Clarissa Dalloway in Mrs. Dalloway (1997); and Dr. Sonia Wick in Girl, Interrupted (1999). Many of these roles and others garnered her various accolades.

Her performance as a lesbian grieving the loss of her longtime partner in the HBO series If These Walls Could Talk 2 earned her a Golden Globe for “Best TV Series Supporting Actress” in 2000, as well as earning an Emmy Award for Outstanding Supporting Actress in a TV Movie or Miniseries. In 2005, Redgrave joined the cast of the hit series Nip/Tuck, which was in its second season. Redgrave played Dr. Erica Noughton, the mother of Julia McNamara, who's played by her real life daughter Joely Richardson. She also made appearances in the third season. In 2006, Redgrave starred opposite Peter O'toolein the acclaimed film Venus. Redgrave's most recent work include 2007's Evening and the acclaimed Atonement, in which she garnered a Broadcast Film Critics Association award nomination for her performance that only took up seven minutes of screen time. In 2008, Ms, Redgrave appeared as a narrator in an Arts Alliance production, id - Identity of the Soul.