Kraus graduated from New York University's Gallatin School of Individualized Study. She met Emma McLaughlin while both were attending New York University, and working as nannies. She lived as a child at 1000 Park Avenue, whose residents she claims inspired some of the characters in her fiction.
Their first novel, The Nanny Diaries, a tale about a 20-something New York nanny, reached #1 on the New York Times Best Seller list in 2002. The film version was released in 2007.