Among her film appearances are roles in Stardust (1974), The Brute (1977), The Krays (1990), The Russia House (1990), White Hunter Black Heart (1990), The Saint (1997), Ghosts of Mars (2001) and Dead Space: Aftermath (2010) (voiceover). Cornwell has also worked extensively on television including appearances in Rock Follies, The Men's Room, The Governor, Shalom Salaam, Lovejoy, Love Hurts, Where the Heart Is, A Touch of Frost, Silent Witness, The Mentalist, Dressing for Breakfast, Capital City, The West Wing, Casualty, The Practice, New Tricks, Toast of London, and Midsomer Murders, among other television programmes in Britain and the United States.

Cornwell was a leading member of the Royal Shakespeare Company for three years, including Rosalind in As You Like It and Beatrice in Much Ado About Nothing and has worked as a leading Actress with the Royal National Theatre since 1984. She has worked extensively both in the West End and at fringe venues, and has appeared in the US in several productions, including Richard III and An Enemy of the People opposite Sir Ian McKellen, Athol Fugard's The Road to Mecca, Terence McNally's Master Class, Stephen Sondheim's A Little Night Music (San Francisco Bay Critics' Award), and Alan Bennett's The History Boys at the Ahmanson Theatre in Los Angeles. In a return to staged Shakespeare, in Summer 2016 she was the Chorus in the Regent's Park production of Henry V.

Cornwell won a libel action against the Journalist Nina Myskow and The Sunday People in December 1985. A jury at the High Court awarded her £10,000 in damages after Myskow, in an article for the newspaper, had referred to Cornwell as unattractive, middle-aged and whose "bum is too big". The case went to appeal, and Cornwell ended up £70,000 out of pocket from legal costs. She taught at the University of Southern California School of Dramatic Arts from 2004 to 2012, and returned to resume her acting career in the UK in June 2012.

Cornwell was born in Marylebone, London, the daughter of Ronald Cornwell. She is the half-sister of spy Novelist John le Carré (David Cornwell). She describes him as "the best brother a girl could have". Le Carré based the main female character in his novel, The Little Drummer Girl—an English Actress called "Charlie"—on her. She has a daughter, Nancy Cranham, from a former relationship with actor Kenneth Cranham.