Jayawardena was born and had her secondary education in Sri Lanka and later decided to enter the London School of Economics in 1952. She graduated with a degree in political science in 1955 and then qualified as a barrister from Lincoln's Inn, London in 1958. She also obtained the Certificat d'Etudes Politiques from Institut d'etudes politiques de Paris in Paris (best known as Sciences Po) in 1956. In 1964 she received a Ph.D. for a thesis on the labour movement in Ceylon, from the London School of Economics.

Jayawardena taught Political Science at the University of Colombo in Sri Lanka from 1969 to 1985, when she retired as Associate Professor. She also taught in the Women and Development Masters Course at the Institute of Social Studies in the Hague, Netherlands from 1980 to 1982, and was an Affiliated Fellow of the Bunting Institute at Radcliffe College from 1987 to 1988. She currently teaches in the Masters Programme in Women's Studies at the Colombo University and is a Senior Fellow of the university's Graduate Studies Institute.

Jayawardena's books and articles have been translated into Sinhala and Tamil. She plays an active role in women's research organizations and civil rights movements in Sri Lanka, and is presently the Secretary of the Social Scientists' Association, a group of concerned scholars working on ethnic, gender, caste and other issues.