Nuala O'Faolain was born in Dublin, the second eldest of nine children, to a well-known Irish journalist. She received degrees in English from University College Dublin, Medieval Literature from the University of Hull, and then Philosophy from Oxford University. On her return to Ireland she taught English at University College Dublin. She moved back to London to work as a television producer for the BBC. In 1977 she returned again to Ireland to work as a producer for and Radio Telefís Éireann, for which she won Jacob's Award in 1985.
In 1996 she published her first novel, Are You Somebody? The Accidental Memoir of a Dublin Woman. In 2001 she published a memoir, My Dream of You, which she followed with a second memoir, Almost There: The Onward Journey of a Dublin Woman in 2003. In 2006, she won the Prix Femina for her biography The Story of Chicago May (2005).
As an author, she split her time between Ireland and New York City. From 2002 until her death, she lived most of the time in New York City with Brooklyn-based attorney John Low-Beer and his daughter Anna. In 2008 she died of cancer.