At the height of her popularity, Lin was inarguably one of the most sought-after actresses in the Chinese film industry. She starred in more than 100 movies. Lin was credited for boosting Taiwan's film production in the 1970s before earning even greater popularity in Hong Kong in the 1990s, becoming a trans-island legend of her time.

She was born in Taipei and she was discovered in 1972 by a film Producer after she finished women high school and was preparing for University. Her movie debut is in Outside the Window (1973) which made her a star. Subsequently, she joined Chiung Yao's company and gained recognition for her roles in romantic films based off the novels by Chiung. Lin won the Best Actress award at the Asia-Pacific Film Festival for her role as a girl scout in Eight Hundred Heroes (1976).

Known for being a "screen goddess" by Chinese film lovers, Lin's early collaborations with Hong Kong New Wave Directors Ringo Lam, Tsui Hark and Jackie Chan in Love Massacre (1981), Zu Warriors from the Magic Mountain (1983), Police Story (1985) and Peking Opera Blues (1986) brought her success. In 1990, she won the Best Actress trophy at the 27th Golden Horse Awards for her depiction of a Chinese female Writer who fell in love with a Japanese collaborator in Red Dust (1990).

In 1992, Swordsman II directed by Tsui Hark brought Lin one of the most memorable roles in the history of Chinese martial arts movies. In the film, she succeeded in portraying the male protagonist Dongfang Bubai. Swordsman II marked the peak of her career in terms of box office earnings. It was featured on Time magazine as one of the greatest films made since 1923. Subsequently, she starred in many other notable martial epics including New Dragon Gate Inn (1992) and The Bride with White Hair (1993). Lin's subsequent collaborations with Wong Kar-wai in Ashes of Time (1994) and Chungking Express (1994) were also some of her most notable films.

Lin married Hong Kong businessman Michael Ying in 1994 and left the film industry. She has two daughters, born in 1997 and 2001. She made her first public appearance since her marriage at the screening of Ashes of Time Redux during the 2008 New York Film Festival.