Singh returned to acting in 2002 with the film 23rd March 1931: Shaheed, in which she played the mother of Bhagat Singh (played by Bobby Deol). She joined the television industry with Ekta Kapoor's family drama Kavyanjali, aired on Star Plus in 2005. Singh was seen in a negative role in the show, that soon gained immense popularity. Later that year, she won acclaim for her performance in yet another negative role for the film Kalyug.

Singh made her Bollywood debut in 1983 with Betaab, an immensely successful film in which she was paired with Sunny Deol. This was quickly followed by a succession of hits, such as Sunny in 1984, Mard (which was the biggest hit of that year) and Saaheb in 1985, Chameli Ki Shaadi and Naam in 1986 and Khudgarz in 1987. Singh made a successful pair in several films, not only with Sunny Deol and Sanjay Dutt, but also with Anil Kapoor and Amitabh Bachchan, two leading actors of the 1980s.

Through her paternal grandmother Mohinder Kaur, Amrita is the great-granddaughter of Sobha Singh, OBE, of Hadali, Sargodha, one of the builders of New Delhi, and the great-niece of the late Novelist Khushwant Singh. She is also related to many personalities in the Indian film industry through her mother, and later through her marriage to actor Saif Ali Khan in 1991. The couple married in an Islamic wedding ceremony. Singh converted to Islam before marriage. 12 years younger than her, Khan is the son of former Indian test cricket captain Mansoor Ali Khan Pataudi, the ninth Nawab of Pataudi and Actress Sharmila Tagore. Their daughter Sara Ali Khan was born in 1993, and son Ibrahim Ali Khan in 2001. Amrita gave up acting for a family life with her husband. After thirteen years of marriage, they divorced in 2004.

As well as playing leading roles, she also played supporting negative roles in films such as Raju Ban Gaya Gentleman (1992) and Aaina (1993). She also won the Filmfare Best Supporting Actress Award for the latter. These successes did not dissuade her from her resolve to retire into family life and she quit acting after her appearance in the 1993 film Rang.

In 2007, Singh played the role of gangster Maya Dolas' mother, Ratnaprabha Dolas, in the Sanjay Gupta film Shootout at Lokhandwala, directed by Apoorva Lakhia. Vivek Oberoi played the role of Maya. Later on she appeared in the anthology film Dus Kahaniyaan, where she appeared in the short story Poornmasi.

Continuing her acting journey, Singh played in the film Kajraare in 2010, and also appeared in Aurangzeb under the Yash Raj Films banner, where she was paired with Jackie Shroff after almost two decades. In 2014, she was seen in the film 2 States, produced by Dharma Productions, portraying the role of co-actor Arjun Kapoor's mother. The film released on 18 April 2014. In 2016, she appeared in Flying Jat playing Tiger Shroff's mother and recently in 2017 she appeared in Hindi Medium.