Dominick Dunne was the brother of author John Gregory Dunne; the Writer Joan Didion was his sister-in-law. He was married to Ellen Beatriz Griffin from 1954 to 1965. He was the father of Alexander Dunne and the actors Griffin Dunne and Dominique Dunne, as well as two daughters who died in infancy.

He began his career as a Producer in film and television, noted for involvement with the pioneering gay film The Boys in the Band (1970) and the award winning drug film Panic in Needle Park (1971). He turned to writing in the early 1970s. After the 1982 murder of his daughter Dominique, he came to focus on the ways in which wealth and high society interacts with the judicial system. A frequent contributor to Vanity Fair, Dunne also appeared regularly on television discussing crime from the 1980s to the end of his life.

After serving in the military, he attended and graduated from Williams College. Dunne then moved to New York City, where he became a stage manager for television. He was later brought to Hollywood by Humphrey Bogart, who wanted Dunne to work on the television version of The Petrified Forest. Dunne worked on Playhouse 90 and became vice-president of Four Star Television. He hobnobbed with the rich and famous of those days, including Elizabeth Taylor. In 1979, beset with addictions, Dunne left Hollywood and moved to rural Oregon. Here he says he overcame his personal demons and wrote his first book, The Winners.

Dominique Dunne, most known for her role in the film Poltergeist, was strangled by her ex-boyfriend John Sweeney, resulting in her death on November 4, 1982. Dominick Dunne covered the trial of his daughter's murder for Vanity Fair, and was outraged alongside the rest of his family when Sweeney received acquittal of the second-degree murder charge in favor of voluntary manslaughter.

In 2005, California Congressman Gary Condit won an undisclosed financial settlement and an apology from Dunne, who had earlier implicated him in the disappearance of Chandra Levy in Washington, DC. The intern was from Condit's U.S. House of Representatives district. Dunne alleged that Condit had been having an extramarital affair with her in Washington. In November 2006, Dunne was sued again by Condit for comments made about the former Politician on Larry King Live on CNN. This suit was eventually dismissed.

In September 2008, Dunne disclosed that he was being treated for bladder cancer. He was working on Too Much Money, his final book, at the time of his death. On September 22, 2008, Dunne complained of intense pain, and was taken by ambulance to Valley Hospital. Dunne died on August 26, 2009, at his home in Manhattan and was buried at Cove Cemetery in the Shadow of Gillette Castle in Hadlyme, Connecticut.

On October 29, 2009 (what would have been Dunne's 84th birthday), Hollywood friends and some reporter friends, along with new Hollywood figures, gathered at the Chateau Marmont to celebrate Dominick Dunne's life. Vanity Fair magazine paid tribute to Dunne's life and extensive contributions to the magazine in its November 2009 issue.