Karr grew up in Dorothy, New Jersey, where her family owned a chicken farm. She earned a bachelor of arts degree in English literature from Catholic University in 1968 and a master's degree in English literature from Providence College in 1971. She was married to Lawrence F. Karr from 1968 until his death in 2007. They have two children, Suzanne Karr Schmidt, born in 1978, and Daniel Karr, born in 1983.

Karr lived in Washington, D.C., working at the newly formed American Film Institute in 1971. After a year there, she worked for the Circle Theatre chain until her daughter was born. She wrote her first novel, Light of My Heart in 1984. After her young children asked her to write a story for them, she published her first children's book, It Ain't Always Easy (1990), and began a full-time career writing for children and young adults. In her novel The Great Turkey Walk she depicts the movement of poultry from county to county where poultry was walked from Union in Monroe County to the stockpens in much the same way it was done for centuries. She is the author of Gilbert and Sullivan Set Me Free about women's prison. Based on a historical event in 1914, the inmates of Sherborn Women's Prison in Massachusetts, U.S., put on a performance of The Pirates of Penzance. In the novel, the prison's chaplain uses the transformative power of music and theater to help reform the inmates, bringing them together to work on the show as a spirited community

Karr is the author of more than two dozen historical novels for children and young adults. Known for their period details and historical accuracy, most of her books take place in the nineteenth or early twentieth centuries.

She is the recipient of the 2003 Agatha Award for best Children's/YA Mystery of the Year for The Seventh Knot; the Society of Children’s Book Writers and Illustrators (SCBWI) 2000 Golden Kite Award for Best Fiction for The Boxer; and the ALA Notable and Best Books for Young Adults commendations for her other works. The Great Turkey Walk was chosen as Best Book of the Year by both Publishers Weekly and School Library Journal.

Karr is also a member and former president of the Children's Book Guild of Washington, D.C., and a member of the Society of Children's Book Writers and Illustrators.