Daughter of John Simpson , head of a Roman Catholic Suffolk farming family. Elizabeth was educated with her sisters at home. At the age of 19 she went to London in order to act. Young and alone, she was apparently the victim of sexual harassment. In 1772 she agreed to marry the actor Joseph Inchbald (1735—1779), possibly at least partially for protection. The marriage was reported to have had difficulties. For four years the couple toured Scotland with West Digges's theatre company, a demanding life. In 1776 they moved to Liverpool and Inchbald met actors Sarah Siddons and her brother John Philip Kemble, both of whom became important friends. The Inchbalds subsequently moved to Canterbury and Yorkshire. After Joseph Inchbald's death in 1779, Inchbald continued to act for several years, in Dublin, London, and elsewhere. Her acting career, while only moderately successful, spanned seventeen years and she appeared in many classical roles, as well as in new plays such as Hannah Cowley's The Belle's Strategem.
Between 1784 and 1805 she had nineteen of her comedies, sentimental dramas, and farces (many of which were translations from the French) performed at London theatres. Eighteen of her plays were published, though she wrote several more; the exact number is in dispute though most recent commentators claim between 21 and 23. Her two novels have been frequently reprinted. She also did considerable editorial and critical work. A four-volume autobiography was destroyed before her death upon the advice of her confessor, but she left some of her diaries. The latter are currently held at the Folger Shakespeare Library and an edition was recently published.
Her play Lovers' Vows (1798) was featured by Jane Austen in her novel Mansfield Park.
A political radical and friend of William Godwin and Thomas Holcroft, her political beliefs can more easily be found in her novels than in her plays due to the constrictive environment of the patent theatres of Georgian London. "Inchbald's life was marked by tensions between, on the one hand, political radicalism, a passionate nature evidently attracted to a number of her admirers, and a love of independence, and on the other hand, a desire for social respectability and a strong sense of the emotional attraction of authority figures".
In recent decades Inchbald has been the subject of increasing critical interest, particularly among scholars interested in women's writing.