Lisa Gerrard was born on 12 April 1961 in Melbourne, and grew up in the suburb of Prahran with her Irish immigrant parents. She has said that she grew up with "Mediterranean music blaring out of the houses" and that this influenced her music, particularly on later Dead Can Dance albums and in her solo and collaborative works.

Gerrard's first foray into forming bands and creative music-making was in Melbourne's little band scene, an experimental post-punk scene which flourished from 1978 until 1981. It was at one of these little band events that she first met Dead Can Dance co-founder Brendan Perry. Perry recalls, "It never occurred to me that we would one day collaborate musically together because at the time I thought her music was too avant garde. I particularly remember one song that she sang about finding a man in the park and asking her mother if she could bring him home to keep in her wardrobe as she attacked this Chinese dulcimer with two bamboo sticks".

Dead Can Dance originally formed as a quartet in 1981 in Melbourne, but in 1982 moved to London with members Gerrard, Brendan Perry and bass player Paul Erikson. Shortly after coming to England, Erikson flew back to Australia, leaving the band as a duo. Dead Can Dance recorded eight albums on the 4AD Records recording label beginning with the self-entitled Dead Can Dance LP in 1984. In 2005, the song "Nierika" became part of the opening titles for Mexican television station TV Azteca's soap opera "La Chacala". The band split in 1998, but reunited in 2005 for a world tour. In 2012, the band announced a new world tour to coincide with the release of their new album, Anastasis.

Gerrard's first experience in composing music for a film came with the 1989 Spanish film El Niño de la Luna, directed by Agustí Villaronga. The film score was composed by Dead Can Dance and the film featured Lisa Gerrard in her first acting role. El Niño de la Luna describes the story of David, a young orphan with special powers, escaping an institution with the help of a fellow institute inmate, Georgina, played by Lisa Gerrard.

Gerrard was married to Polish graphic design Artist and music Producer Jacek Tuschewski, with whom she has a daughter (born 1992).

In 1995, Gerrard recorded and released her first solo album, The Mirror Pool. After the release of this album, she continued to work with Dead Can Dance, releasing the album, Spiritchaser, in 1996. Following this, in 1998 she recorded Duality in collaboration with Pieter Bourke. This album would mark the beginning of an extensive collaboration for a number of film scores, including The Insider and Ali. Gerrard began a new collaboration with Patrick Cassidy in 2004 with the release of Immortal Memory. Again, this collaboration was furthered in film work, including Salem's Lot.

Gerrard participated in a number of musical scores but came to fame as a film Composer after recording The Insider in 1999, with Pieter Bourke, and Gladiator in 2000, with Hans Zimmer, which received an Academy Award nomination for best music score, although only Zimmer was nominated. It did, however, win a Golden Globe Award for both composers. Gerrard's score for the New Zealand independent film Whale Rider consisted entirely of solo material; a Soundtrack album was released by 4AD.

In 2005 Gerrard collaborated with Ennio Morricone for Fateless followed by a collaboration with Jeff Rona on the score for the feature film "A Thousand Roads" and the song On an Ocean for the Henry Poole Is Here score. Gerrard along with Dead Can Dance also provided several contributions to the Soundtrack of Baraka, a visual journey showcasing mankind's impact on our planet. Gerrard was also invited by Denez Prigent to collaborate with him on his piece "Gortoz a ran – J'attends" (meaning "I await"), a piece that was later used in the Soundtrack of Ridley Scott's film Black Hawk Down.

Also in 2006, Gerrard released her second solo album, The Silver Tree. This album was markedly different from her previous work and was also her first album released outside 4AD Records. The album was first released on iTunes, with a wider physical release planned at a Future date. The album was nominated for the Australian Music Prize for 2006. In 2007 a retrospective album The Best of Lisa Gerrard, a compilation of fifteen songs, was released covering her career in Dead Can Dance, solo work, and film work.

A world tour was undertaken in 2007 beginning in April in Melbourne, Australia. This tour marked the first time Lisa Gerrard had toured in Australia, with a performance in three cities. The tour was followed by performances in Europe and North America. More performances took place in Europe and Russia from 30 October to 22 November 2007. In November 2007, Gerrard collaborated with German electronic musician Klaus Schulze on the double-album Farscape. The album was released 27 July 2008 and was followed by a European tour.

In 2009 Gerrard wrote the score for Balibo, for which she won a Best Feature Film Score award at the 2009 APRA Screen Music Awards and an Aria Award for Best Original Soundtrack/Cast/Show Album at the 2009 Aria Awards. Gerrard finished 2009 by contributing her voice to the theme song for the Japanese NHK taiga drama Ryōmaden, which began airing in 2010.

In November 2010 Gerrard provided vocals and additional music for the post-apocalyptic sci-fi thriller Priest, scored by Christopher Young, which was released in 2011.

In November 2011 Gerrard completed the score for Burning Man, which won her Best Music Score at the 2011 Film Critics Circle of Australia awards, beating scores for Snowtown, The Hunter and Red Dog.

In July 2014, Gerrard released a new solo album entitled Twilight Kingdom through her own record label, Gerrard Records.

Gerrard's vocals are heavily featured in the video game 'Armello' launched on 1 September 2015, titled 'Wyld's Call', produced by Michael Allen. Her vocals feature towards a Celtic theme of the soundtracks.