Setton was born in New York City, and grew up in Great Neck, where she was President of her high school's theater club. She is Jewish, and of both Syrian-Jewish and Austrian-Jewish descent. Setton majored in drama at Ithaca College, where she graduated in 2007. In her junior year she studied abroad in Barcelona, Spain in an IES program. Setton completed a comprehensive two-year Meisner technique program at The Actor's Workshop of Ithaca under the instruction of Eliza VanCort.

Setton played Penelope Shafai on the teen drama Gossip Girl from 2008 to 2012. She made her debut on the ABC soap opera One Life to Live as Kimberly Andrews on August 14, 2009. Setton also had small roles in the 2008 films Sex and the City and What Happens in Vegas. The website Daytime Confidential reported on February 21, 2010 that Setton had taped her last episode as Kim on One Life to Live despite being offered a contract and a pay increase.

Setton returned to Gossip Girl in 2010. It was announced on June 22, 2011 that Setton would be returning to One Life to Live as Kimberly Andrews in August 2011. On July 11, 2012, Setton was cast as a series regular on the Fox comedy series The Mindy Project, playing the role of Shauna Dicanio. However, it was reported on November 20, 2012 that her character would be written out of the show. Setton had a guest role on the pilot episode of the CBS crime drama series Golden Boy, which premiered February 26, 2013, the same day that Setton was cast in the CBS sitcom The Crazy Ones. She played recurring character Dr. Mindy Shaw during the fifth season of Hawaii Five-0.