Born Laura Kean Zametkin in New York City, the daughter of Jewish socialist immigrants, she graduated from Cornell University. On July 23, 1930, she married Francis Thayer Hobson, owner of William Morrow and Company. In 1934, she joined the promotional staff of Time, Life, and Fortune.

In 1935, her marriage ended in divorce. In 1937, she decided to adopt a baby. She became pregnant in 1941, raising both children on her own.

After 1940 she devoted herself to writing. On April 27, 1947, her most famous work, Gentleman's Agreement, reached #1 on The New York Times best-sellers' list and sold over 1.6 million copies. A later novel, Consenting Adult (1975), about a mother dealing with her son's homosexuality, was based on her experience with her son, Christopher. It was adapted as a made-for-TV movie in 1985.

Hobson died on February 28, 1986, in New York City.