Oleynik was born in Santa Clara County, California. Her mother Lorraine (née Allen) is a former nurse, and her late father Roman Oleynik (1936–2003) was an anesthesiologist. Her father was of Ukrainian ancestry, and she was raised in the Eastern Orthodox Church. Oleynik grew up in the San Francisco Bay Area. She attended Pinewood School in Los Altos, California. As her acting career flourished, she would "divide her time between normal childhood experiences in Northern California and auditions in Los Angeles."

Oleynik began acting in a San Francisco production of Les Misérables in 1989 after seeing an audition ad in a newspaper when she was eight years old. She obtained two parts in the production (young Cossette and young Eponine), both with singing roles. After appearing in the musical, she contacted an agent and began taking acting lessons. Her onscreen acting career began at age 12, in a 1993 episode of the television series Dr. Quinn, Medicine Woman; the same year she also appeared in the made-for-television film River of Rage: The Taking of Maggie Keene and in 1996 made a cameo on The Adventures of Pete & Pete as a nurse at the beginning of the episode "Dance Fever". Later in 1993, she was subsequently cast in the lead role of the series The Secret World of Alex Mack where she portrayed a teenage girl who receives telekinetic powers as the result of an accident. She won the role of Alex Mack over 400 other aspirants. The series ran on Nickelodeon from 1994 to 1998 and was one of the network's top three most watched shows, becoming quite a favorite among the child and teen audiences and turning Oleynik into a teen idol. During the show's heyday, children who met Oleynik (and were too young to understand special effects) would often ask her to "morph" for them. Rather than try to explain things, she would quickly glance around, then tell them "Not here – everybody would see!". Oleynik reprised the role in an All That Sketch, although the name was changed to "Alex Sax". She later made an appearance in the 100th episode of the show.

Also during her time on The Secret World of Alex Mack, she played one of the lead characters in the 1995 feature film The Baby-Sitters Club (opposite Rachael Leigh Cook and Schuyler Fisk), appeared in several episodes of Boy Meets World, wrote an advice column for Tiger Beat magazine, and was involved in Nickelodeon's The Big Help charity, Hands Across Communication, Surfrider Foundation and the Starlight Children's Foundation. She has also hosted the CableACE Awards, Daytime Emmy Awards, YTV Achievement Awards, The Nickelodeon Kids' Choice Awards as well as The Big Help. She has commented that she stayed "grounded" during her period as a teen star, mainly through the help of a "strong network of people" that she is close to.

After The Secret World of Alex Mack ended its run, Oleynik had a starring role in the film 10 Things I Hate About You as Bianca. The film was released in April 1999 and did fairly well at the box office, grossing a total of $38 million domestically. From 1998 to 2000, Oleynik appeared in twenty-one episodes of the NBC series 3rd Rock from the Sun as Alissa Strudwick. During 2000, she also appeared in two independent films: 100 Girls (opposite Emmanuelle Chriqui, Katherine Heigl and Jonathan Tucker) and A Time for Dancing (opposite Shiri Appleby); neither film received a theatrical release in the United States. She has appeared in Malcolm in the Middle as Reese Wilkerson's lesbian army buddy who develops a crush on Lois Wilkerson.

Oleynik had a supporting role in the film An American Rhapsody, which received a limited release in August 2001, and appeared in Bringing Rain, a low-budget film. Oleynik was cast in a supporting role in the series Pepper Dennis, which began airing on The WB in April 2006, but was not picked up by The WB's successor The CW. In March 2008, Oleynik guest-starred in episode 13 of Aliens in America. In 2009, she provided audio commentary for the 10 Things I Hate About You 10th Anniversary Edition Blu-ray. In March 2011, Oleynik started appearing in a recurring role on Hawaii Five-0 as CIA analyst Jenna Kaye until her character was later killed off. Oleynik appears as Ken Cosgrove's girlfriend (and later wife) Cynthia Baxter in several episodes on the AMC television show Mad Men.

In January 2013, according to TMZ, Oleynik was granted a restraining order against one of her fans, who she claims was so obsessed he changed his last name to hers, as well as leaving gifts for her at her mother's apartment.

After the success in her role as Alex Mack, Oleynik decided to attend college. She attended Sarah Lawrence College and described her time there as "the best decision I’ve made".