Lagerfelt began her career working in theater. Her first professional job was as a stage manager and understudy for the 1971 Broadway play Four on a Garden. That same year she made her onstage debut as Liz in Christopher Hampton's The Philanthropist at the Royal Court Theatre. She returned to Broadway two years later as Lady Ursula Itchin in the 1973 play The Jockey Club Stakes and again in 1975 as Marie-Louise Durham in The Constant Wife. Her performance in the latter earned her a Drama Desk Award nomination. Her next role on Broadway was as Beth in the 1977 play Otherwise Engaged.

In 1979, Lagerfelt made her first foray into television as a guest star on Archie Bunker's Place. This was followed by numerous appearances on television shows throughout the 1980s, including T. J. Hooker, The Twilight Zone, Cagney & Lacey, Spenser: For Hire, The Equalizer and several television films. Lagerfelt made her film debut as Elizabeth Masters in the 1986 film Iron Eagle.

Lagerfelt remained active in theater throughout the 1980s. She returned to Broadway in 1980 to portray Emma in Betrayal and then appeared as Jean in the 1982 Off-Broadway play The Sea Anchor. Also in 1982, she portrayed Ruth Carson in Night and Day with the Huntington Theatre Company in Boston. The following year she appeared as Anita Manchip in two different productions of Quartermaine's Terms, one at the Long Wharf Theatre in New Haven, Connecticut and the other at Playhouse 91 in New York City.

Over the years, she has had a variety of short-term and recurring roles on the daytime soaps. As Patricia Devereaux on The Edge of Night in 1983, she was the ex-wife of spy Ian Devereaux who showed up in Monticello to visit Ian and ended up being murdered by Russian spy David Cameron (Norman Parker) who recalled strangling Nora Fulton as he killed Patricia. A few years later, she played Emily Hargrove on As the World Turns who was a witness for the defense in Frannie Hughes' trial for the murder of Douglas Cummings. Ironically, the D.A. in this case was played by Norman Parker who ruthlessly cross-examined Emily on the stand. In between those stints, she had appeared briefly on The Guiding Light as the D.A. in the Charlotte Wheaton murder case. As Roger Gordon's ex-wife Carrie on One Life to Live, she was Sarah's natural mother and Megan's adoptive mother, appearing on occasion from 1988 to 1989.

In 1984, she appeared in the Off-Broadway production of Other Places as Gila/Pauline at the Manhattan Theatre Club and portrayed the role of Annie in the original Broadway cast of Tom Stoppard's The Real Thing (1984–1985) at the Plymouth Theatre. In 1988, she starred in The Wall of Water at the Yale Repertory Theatre and portrayed the role of the Governor's wife in Phaedra Britannica with the Classic Stage Company. She returned to Broadway the following year as Diana in Lend Me a Tenor.

She appeared Off-Broadway as Izz in Swim Visit (1990), Tekla in Creditors (1992), and Simone in The Workroom (1993). Her only Broadway role of the decade was as Anita in the 1992 play A Small Family Business at the Music Box Theatre. In 2014, she appeared in the Roundabout revival of Tom Stoppard's drama Indian Ink at the Laura Pels Theater. Lagerfelt also appeared in several Regional theatre productions including the roles of Suzanne in Don't Dress for Dinner (1992) at the Paper Mill Playhouse, The Misanthrope (1993) at the Long Wharf Theatre, and Death Takes a Holiday (1997) at the Lobero Theater. More recently she has appeared as Elizabeth I in Mary Stuart (2000) with the Huntington Theatre Company and Off-Broadway as Gareth Peirce in Guantanamo: Honor Bound to Defend Freedom (2004).