McKenzie's performance in Hamlet was followed by her role as Joan of Arc in Bernard Shaw's Saint Joan, directed by Gale Edwards for the Sydney Theatre Company at the Sydney Opera House. This was the first time Saint Joan had been staged in Australia since the Zoe Caldwell production in 1962. Regarded as one of "the most revealing tests of an actress", and as "the female Hamlet", Edwards' production was both a critical and box office sensation with McKenzie's performance unanimously acclaimed: "This play stands or falls on the performance of St Joan and McKenzie is simply superb." "From the moment she enters, she sets the stage ablaze. McKenzie is a Joan to make the theatrical heavens rejoice ... McKenzie offers us Joan in all her innocence, ignorance, joyful goodness that seems to light her from within and, almost until the end, a youthful sense of fun. Her slight stature can seem waif thin, piteously vulnerable; but raging into battle she's tough and sturdy, a young woman of intense and convincing action. Always in focus, like an unwavering flame, is McKenzie's Joan the Maid" and "Here is a Joan with such fortitude and faith that seems hardly possible to exist within such a delicate frame. McKenzie's waif-like image conceals remarkable strength, and an almost inexhaustible supply of emotion. It is a Joan to inspire the tamest among us to stand up as individuals, and Listen to the voices inside of us. Shaw himself would have been reluctantly impressed."

Born in Sydney, Australia, McKenzie attended Wenona School in North Sydney until 1983 then moved to Pymble Ladies' College, where she graduated in 1985 with her Higher School Certificate. Known at school for her fine singing voice, McKenzie was cast as Nancy in Oliver! then in Godspell (both a co-productions with Shore School) and later in Brigadoon (a co-production with Knox Grammar School), sharing the stage with Hugh Jackman, who was a student at Knox at the time.

McKenzie studied for a Bachelor of Arts degree at the University of New South Wales in Sydney, Australia. Whilst at university, she began modelling. Represented by Cameron's Management, she worked in both print and television media. She also took regular singing lessons with prominent Australian vocal coach Bob Tasman-Smith. In 1987, McKenzie was cast as the lead in the pilot of television series All The Way alongside Ben Mendelsohn, Robert Mammone, Rowena Wallace and Martin Sacks. During this time, she came to the attention of the premier casting agent in Australia, Liz Mullinar, who had cast Judy Davis in My Brilliant Career and Nicole Kidman in Dead Calm. Following advice from Mullinar, McKenzie auditioned for the prestigious National Institute of Dramatic Art (NIDA) and was accepted. Opting out of both her arts degree and All The Way, McKenzie attended NIDA in 1988. She graduated in December 1990.

In 1991, McKenzie was awarded "Best Newcomer Award" from the Sydney Theatre Critics Circle, which recognized her chameleon-like ability and her consistently high calibre work in theatre productions Child Dancing (as Julie-Ann); The Master Builder (as Kaja); Twelfth Night (as Viola) and Rebecca (as Mrs de Winter). During rehearsals for Rebecca, Director George Ogilvie allowed McKenzie time off to audition for a new Australian Independent feature film called Romper Stomper set to star Russell Crowe, who had casting approval on the film. She was subsequently cast in the film and went on to win Best Actress award at the Film Critics Circle of Australia. Russell would later say "Jacqui's range as an actor disappears over the horizon. And I'm not sure it can actually be defined. When I first saw her, in the play Rebecca, I saw an actor whom I thought was blowing me on the skin from the inside. She is an actor who is both delicate and magical." In her "nothing short of stunning" film debut in Romper Stomper, McKenzie was described as "especially shining in her courage, truth and skill." The role garnered her attention overseas, where she won Best Actress at the 1992 Stockholm International Film Festival for her "stark and non-sentimental portrayal of a young woman whose life has turned into a desperate chase for all she has lost: love, serenity, identity. Her character plays an essential part in creating the inexorable force and impact of the film." Over the next couple of years, she came to be regarded as one of Australia's most promising young actresses of stage and screen, showcasing a "phenomenal emotional range".

Described by head of NIDA, John Clarke, as "A chameleon" "one of the most talented actresses we have produced ... she's an absolute dynamo, a powerhouse," McKenzie had fast earned a reputation as one of the most versatile actresses of her generation, taking on varied and often difficult roles. Equally adept in drama or comedy, she was described as the "Judy Davis of her generation (or funnily enough, the green eyed American actor Meg Ryan)" In 1992, Ben Elton cast her as the lead role of "Rachel", the feisty Environmentalist, in the adaptation of his hit novel Stark. The mini-series was a BBC/ABC comedy, was directed by Nadia Tass and co-starred Ben Elton and Colin Friels. McKenzie received an Australian Film Institute Award nomination for Best Actress in a Miniseries for the role. The same year (1993), she scored a Best Actress in a Feature Film nomination for her comedic turn in the indie comedy, This Won't Hurt a Bit, playing Vanessa Presscott, a nerdy English ingénue with a speech impediment. In 1994, McKenzie reunited with Director George Ogilvie (who had directed her in Rebecca and Twelfth Night) to play the lead role of Dancy Smith in the adaptation of Kylie Tennant's famous depression-era drama The Battlers. The mini-series co-starred Gary Sweet and played on the Seven Network. McKenzie was nominated again for Best Actress in a TV Drama at the Australian Film Institute 1994 awards. That same year, McKenzie was also nominated for Best Supporting Actress in the feature film Traps, directed by Pauline Chan. Playing the French girl living in Colonial Vietnam, McKenzie got to showcase her versatility by speaking in both French and Vietnamese for the role.

In 1994, McKenzie starred alongside David Wenham, Geoffrey Rush and Richard Roxburgh in Shakespeare's Hamlet, directed by Neil Armfield, for Belvoir St Theatre, Sydney. This sellout production was a critical, award-winning success with McKenzie's performance "so exquisitely pitched it could have shattered glass". "Jacqueline McKenzie's fragile Ophelia, dressed in cottontails and a tail-coat, turning the stage into a mind-state of shattered glass. Her presence awesomely palpable because of its sheer intangibility" The production went on to tour to Melbourne but McKenzie was unable to continue due to other work commitments. (Cate Blanchett took over the role of Ophelia for the tour.)

In 1995, McKenzie made Australian Film Institute history by winning the Beyond Best Actress in a Leading Role for Angel Baby and the Beyond Best Actress Award in a TV Drama for Halifax f.p.: Lies of the Mind. She also won the prestigious Silver Logie for Most Outstanding Actress at the Logie Awards for her role in Halifax f.p.. It was for playing the young lover Kate, opposite John Lynch's Harry in the Michael Rymer helmed drama Angel Baby, that McKenzie received international acclaim: The LA Weekly reviewed: "McKenzie is a find. Whether using answers on the Wheel of Fortune as a kind of daily horoscope, or cringing in terror as the upright legs of chairs in an empty restaurant seem to whisper at her, she is blazingly equal to the extremes of animal panic and hyperconscious insight that are the north and south of this movie's humane compass." Angel Baby also featured Actress Deborra-lee Furness and Colin Friels. In 1996, McKenzie was awarded Australian Star of the Year at the Australian Movie Convention.

In 1996, a portrait of McKenzie by Australian narrative Painter Garry Shead was a finalist in the Archibald Prize and the Doug Moran National Portrait Prize.

McKenzie ventured to the USA where she starred in films such as Deep Blue Sea (1999) directed by Renny Harlin with Samuel L. Jackson, Thomas Jane and Michael Rapaport; Divine Secrets of the Ya-Ya Sisterhood (2002) with Sandra Bullock, Ashley Judd, Ellen Burstyn, Kiersten Warren and James Garner; Freak Weather, with Aida Turturro and John Carroll Lynch; Love from Ground Zero with Simon Baker and Pruitt Taylor Vince, as well as tele-movie When Billie Beat Bobby, starring Holly Hunter and Ron Silver. She starred in the UK independent films Eisenstein with Simon McBurney and Kiss Kiss (Bang Bang) with Stellan Skarsgård, Chris Penn and Paul Bettany.

In 2001, McKenzie was given a United States Green Card in March 2001 for "Person of Extraordinary Ability". She made her US Theatre debut, starring as Rita in Willy Russell's Educating Rita, at the Williamstown Theatre Festival directed by Bruce Paltrow and co-starring Edward Herrmann. It was a huge success. "This production had the inexhaustible talents of Jacqueline McKenzie, an utterly charming and irrepressible Australian, whose cockney accent was spot on and characterization was full-cocked. Bursting onto the stage like a fire-engine responding to a five-alarm conflagration, McKenzie was a dynamo with enough Energy to fill simultaneous performances of this and Pygmalian (a sure bet for her if the WTF wants to bring her back – and it should). Suffice to say, hers will surely be among the most memorable and reason enough to revive Rita."

In 2004, McKenzie made the switch to prime-time television in a role that would catapult her to international stardom. Cast as the lead female detective Diana Skouris in the US prime-time science fiction television series The 4400 from Executive Producer Francis Ford Coppola, McKenzie was cast alongside Joel Gretsch (Taken, Minority Report) – an onscreen partnership oft likened to Mulder and Scully. Directed by Yves Simoneau with show Runner Ira Steven Behr (Star Trek: Deep Space Nine), The 4400 was the highest rating debut on US Cable for 2004 earning a Primetime Emmy Award nomination for Best Mini-Series. The show ran on the US Network for four seasons, ending in 2007. In 2006, McKenzie also starred as Linda Landry in "Umney's Last Case" opposite william H. Macy – the third episode of Nightmares and Dreamscapes on TNT. In 2008, McKenzie starred as Psychiatrist Veronica Hayden-Jones in the 13 part series Mental on the Fox Network, which was filmed at Fox Telecolombia in Bogotá, Colombia. Starring Annabella Sciorra, this was the first American television series to be filmed in Latin America for international markets. McKenzie guest starred in Desperate Housewives, Without a Trace, CSI: Miami, Hawaii 5-0 and the Australian TV series Rake. She was cast as Emma Waddell in the Jeremy Sims–directed feature film Beneath Hill 60 and starred in the 2010 season finale of NCIS: LA alongside former Deep Blue Sea castmate, LL Cool J.

In 2011, Cate Blanchett and Andrew Upton, the co-artistic Directors of the Sydney Theatre Company, invited McKenzie to star in their production of Sarah Ruhl's In the Next Room (or The Vibrator Play) at the Sydney Opera House, Drama Theatre. Co-starring Mandy McElhinney, this production went on tour to Melbourne Theatre Company, Wollongong, Canberra and Parramatta Riverside Theatre, earning McKenzie a Best Actress nomination at the Green Room Awards for her role as Mrs Givings. This was McKenzie's first play since her critically acclaimed turn as Catherine in David Auburn's Pulitzer Prize Winning play Proof, which sold out at The Sydney Opera House in 2003.

In 2012, she accepted Cate Blanchett and Andrew Upton's invitation to star in the Australian premiere of the two-hander Sex With Strangers by American Playwright Laura Eason (House of Cards) for the Sydney Theatre Company. This critically acclaimed production co-starred Ryan Corr and was directed by Jocelyn Moorhouse. An award-winning Director of may films including How to Make an American Quilt, this was Jocelyn's first play.

In 2013, McKenzie starred in the seminal role of Margaret (aka Maggie) in Cat on a Hot Tin Roof by Tennessee Williams for Belvoir St., directed by Simon Stone, co-starring Ewen Leslie (as Brick) and Marshall Napier (as Big Daddy). A sell out production with an extension season at the Theatre Royal, Sydney, McKenzie's performance, in the role that made Elizabeth Taylor famous, was highly acclaimed: "Jacqueline McKenzie has far more scope in this play than she had in the recent Sex with Strangers to display her mesmerizing and neurasthenic talents that are so reminiscent of the early Judy Davis. She squirms, hops, skips and flops through the drama with a manic intensity that is breathtaking to watch from the first scene when she works her way through about a dozen changes of clothing and many pairs of 'hot' shoes during her long and intense opening monologue" and "McKenzie has been playing some major roles in Sydney recently but here is a great one, finally worthy of her ability, and she rises to it magnificently. Her Maggie is full of feverish Energy, and hard-won, hard-edged glamour that a woman who has clawed herself up out of poverty to become the wife of the descendent of a crass but very rich family might be expected to display. She is better than them. She is beautiful, her smile is always bright but brief glimpses of self-doubt betray her origins, and her eyes betray her desperation." "This is a good production, made great by McKenzie's beautiful performance."

In 2014, McKenzie reunited with her Romper Stomper co-star, Russell Crowe, to perform in his feature film directing debut, The Water Diviner, in which he also stars. With a hand-picked cast that included Yılmaz Erdoğan, Olga Kurylenko, Ryan Corr, Jai Courtney, Steve Bastoni and Cem Yılmaz, The Water Diviner was nominated for eight AACTA awards including Best Supporting Actress in a feature film for McKenzie, who played the role of Russell's grieving wife Lizzie. For this performance, McKenzie won Best Supporting Actress at the 2014 Film Critics Circle of Australia Awards.

McKenzie was nominated for Best Actress in Orlando and Best Supporting Actress in The Present at the 2015 Sydney Theatre Awards.

McKenzie began filming in the lead role of Jane Chandler for the Australian feature film The Gateway in October 2016. Directed by John Soto, the sci-fi film also starred Myles Pollard and Ben Mortley. The film follows the journey of a particle Physicist who, grieving over the loss of her husband in a car crash, uses a revolutionary machine to bring him back with dire consequences for her family.

McKenzie made headlines in late 2017 after Russell Crowe told a joke at the 2017 AACTA Awards about unintentionally "sodomizing" her during the filming of Romper Stomper in 1992.