Born on December 15th, 1896 in Brooklyn, New York to German immigrants, she grew up poor in Williamsburg, Brooklyn and attended Girl's High School. These experiences served as the framework to her first novel, A Tree Grows in Brooklyn (1943).

After marrying George H. E. Smith, a fellow Brooklynite, she moved with him to Ann Arbor, Michigan, where he pursued a law degree at the University of Michigan. At this time, she gave birth to two girls and waited until they were in school so she could complete her higher education. Although Smith had not finished high school, the university allowed her to enroll in classes. There she honed her skills in journalism, literature, writing, and drama, winning a prestigious Avery Hopwood Award. She was a student in the classes of Professor Kenneth Thorpe Rowe.

In 1938 she divorced her husband and moved to Chapel Hill, North Carolina. There she married Joseph Jones in 1943, the same year in which A Tree Grows in Brooklyn was published. She teamed with George Abbott to write the book for the 1951 musical adaptation of the same name. Throughout her life, Smith worked as a dramatist, receiving many awards and fellowships including the Rockefeller Fellowship and the Dramatists Guild Fellowship for her work in drama. Her other novels include Tomorrow Will Be Better (1947), Maggie-Now (1958) and Joy in the Morning (1963).

At age 75 in January 1972, she died from pneumonia.