After a tough childhood, Duffy took her degree in English from King's College London. She also attended the secondary school Sarah Bonnell She went on to be a schoolteacher from 1956 to 1961, and edited three editions of a poetry magazine called the sixties. She then turned to writing full-time as a poet and playwright after being commissioned to produce a screenplay by Granada Television. Her first novel, written at the suggestion of a publisher, That's How It Was (1962), was published to great acclaim. Her first openly lesbian novel was The Microcosm (1966), set in the famous lesbian Gateways club in London.

To date she has published around thirty works, including five volumes of poetry. Her Collected Poems, 1949—84 appeared in 1985. Her work has often used Freudian ideas and Greek Myth as a framework.

Her novel The Gor Saga was televised in 1988 in a three part miniseries called First Born starring Charles Dance.

She is said to have been Britain's first lesbian to "come out" in public, and made public comments during the debates around homosexual law reform. In 1977 she published "The Ballad of the Blasphemy Trial", a broadside against the trial of the Gay News newspaper for 'blasphemous libel'.

She has been active in a variety of groups representing the interest of writers, and was at one time the President of the European Writers' Congress. She was elected a fellow of the Royal Society of Literature in 1985 and awarded their Benson Medal in 2004 . She is deeply interested in issues around enforcing traditional forms of intellectual property law.

She is a Distinguished Supporter of the British Humanist Association.