Paretsky was born in Ames, Iowa and raised in Kansas, graduating from the University of Kansas with a degree in political science. She did community service work on the south side of Chicago in 1966 and returned in 1968 to work there. She ultimately completed a Ph.D. in history at the University of Chicago; her dissertation was entitled "The Breakdown of Moral Philosophy in New England Before the Civil War." She also earned an MBA from the University of Chicago Graduate School of Business. Married to a professor of physics at the University of Chicago, she has lived in Chicago since 1968. She is an alumna of the Ragdale Foundation.

The protagonist of all but two of Paretsky's novels is V.I. Warshawski, a female private investigator. Warshawski's eclectic personality defies easy categorization. She drinks Johnnie Walker Black Label, breaks into houses looking for clues, and can hold her own in a street fight, but also she pays attention to her clothes, sings opera along with the radio, and enjoys her sex life.

Paretsky is credited with transforming the role and image of women in the crime novel. The Winter 2007 issue of Clues: A Journal of Detection is devoted to her work.

Novels

• Indemnity Only (1982)
• Deadlock (1984)
• Killing Orders (1985)
• Bitter Medicine (1987)
• Blood Shot (1988)
• Burn Marks (1990)
• Guardian Angel (1992)
• Tunnel Vision (1994)
• Ghost Country (1998) - non-Warshawski novel; ISBN 978-0385333368
• Hard Time (1999) ISBN 0-385-31363-2
• Total Recall (2001) ISBN 0-385-31366-7
• Blacklist (2003) ISBN 0-399-15085-4
• Fire Sale (2005) ISBN 978-0739455944
• Bleeding Kansas (2008) - non-Warshawski novel; ISBN 978-0399154058
• Hardball (2009)
• Body Work (2010)

Short story collections

• Windy City Blues (1995)
• V.I. x2 (2002)

Non-fiction

• Writing in an Age of Silence (2007) ISBN 978-1844671229

As editor

• Women on the Case (1997) ISBN 978-0440223252
• Sisters On the Case (2007) ISBN 978-0451222398