On her father's side, she is a descendant of Judge Theodore Sedgwick, Endicott Peabody (the founder of the Groton School), william Ellery (a signer of the Declaration of Independence), Samuel Appleton, John Lathrop (American minister) (1740–1816), of Boston, Massachusetts, and is the great-granddaughter of Henry Dwight Sedgwick III, thus the corresponding niece to his brother Ellery Sedgwick, owner/editor (1908-1938) of The Atlantic Monthly. Sedgwick is also a sister of actor Robert Sedgwick, half-sister of jazz Guitarist Mike Stern, the first cousin once removed of Actress Edie Sedgwick, and a niece of the Writer John Sedgwick. She is also the aunt of R&B/pop singer George Nozuka and his younger singer-songwriter brother Justin Nozuka (their mother, Holly, is Sedgwick's half-sister).

Sedgwick married actor Kevin Bacon on September 4, 1988. Sedgwick learned in 2011, via her appearance on the U.S. TV show Finding Your Roots with Henry Louis Gates, that she and Kevin Bacon are 9th cousins, once removed.

The couple have two children, Travis Sedgwick Bacon (born June 23, 1989) and Sosie Ruth Bacon (born March 15, 1992). The family resides on the Upper West Side of Manhattan.

Sedgwick was nominated for a Golden Globe award for her performance in Something to Talk About (1995). Sedgwick's other film roles include Oliver Stone's Born on the Fourth of July (1989), Cameron Crowe's Singles (1992), Heart and Souls (1992), Phenomenon (1996), What's Cooking (2000), Secondhand Lions (2003), The Game Plan (2007), and The Possession (2012). She also has one of the starring roles in the critically acclaimed 2016 comedy-drama movie The Edge of Seventeen.

Sedgwick starred in the television series The Closer from 2005 to 2012. In 2007, she began earning roughly US$300,000 per episode. Over the life of the series, she was nominated for and won several awards for her starring role as Deputy Chief Brenda Leigh Johnson. She received a Golden Globe award in 2007 for her performance as lead Actress and won a Primetime Emmy Award in 2010. In 2009, Sedgwick was awarded a star on the Hollywood Walk of Fame for Television.

Until 2011, Sedgwick had made television history, being the only female actor to be nominated for an Emmy, Golden Globe, and Screen Actors Guild Award every year that her show aired in the eligibility period. However, that came to an end in 2011 when Sedgwick failed to receive a nomination for Outstanding Lead Actress in a Drama Series at the 2011 Emmy Awards.

The Closer ended on August 13, 2012, following the completion of its seventh season; the series's broadcaster, TNT, said that the decision to retire the series was made by Sedgwick. A sequel series starring most of the same cast called Major Crimes continues in its place.

Sedgwick produced the television series Proof for TNT which debuted in 2015 for one season.