Appignanesi was born in ?ód?, Poland. She grew up in Paris and Montreal, where she studied at McGill University and worked as a Features Editor for The McGill Daily. Following her BA in English and MA (with a thesis on Edgar Allan Poe), she moved to Britain, to do a PhD in Comparative Literature University of Sussex. During this period she spent some time in Paris and Vienna and wrote a thesis on Henry James, Marcel Proust and Robert Musil which was published in 1974 as Proust, Musil and Henry James: Femininity and the Creative Imagination.

After a year working as a writer in a Manhattan social research firm Appignanesi returned to Britain to work as a European Studies lecturer at the University of Essex. Appignanesi also lectured at New England College, and in 1976 helped found the Writers and Readers writers collective, which launched the important graphic Beginners series with titles on Marx and Freud. In 1975 she published The Cabaret, a history of cabaret, a new edition of which came out in 2005 (Yale University Press).

In 1980 she left academia to become Director of Talks and Seminars at the Institute of Contemporary Arts in London, where she stayed for ten years and helped the ICA talks programme gain a reputation as "an intellectual hothouse". While at the ICA she edited the Documents series, which included the books Postmodernism and Ideas from France. She became Deputy Director of the ICA in 1986 and created the ICA-Television branch, which produced England's Henry Moore in 1988 and Seductions for Channel Four She left the ICA in 1990 to write full-time, and received publishing deals for Memory and Desire and Freud's Women (co-written with John Forrester) published in 1991 and 1992 respectively. As well as these she has written nine other fiction and two non-fiction books, including the highly acclaimed Women and the Mind Doctors in 2008.

As well as her writing Appignanesi has also co-written a film on Salman Rushdie for French television, presented two series of radio programmes on Sigmund Freud for BBC Radio 4,, presented the arts and ideas Nightwaves programme for BBC 3, contributed to a variety of programmes, including Start the Week and Women’s Hour, and written for the New Writing Partnership. Appignanesi has appeared as a cultural commentator on many television programmes, including the BBC's Newsnight and Late Review. She is the General Editor of The Big Ideas series, published by Profile, which includes Violence by Slavoj Zizek and Bodies, by Susie Orbach. She worked as a fellow of the Brain and Behavior Laboratory at the Open University, was a council-member of the ICA (2000-06) and is Chair of the Freud Museum, London. She has also written for The Guardian, The Observer, The Independent, and The Daily Telegraph. In 2004 she became the Deputy President of English PEN and in 2008 the President. As part of her work with English PEN she edited Free Expression is No Offence, a collection of writings that formed part of English PEN's protest against what became the Racial and Religious Hatred Act 2006 and helped induce the British Government to amend the Bill by inserting a robust clause protecting freedom of expression. Under her Presidency, English PEN launched its report on Libel Reform, "Free Speech is Not for Sale," helped to rid Britain of obsolete Blasphemy and Criminal Libel laws, as well as setting up the PEN PINTER PRIZE. Appignanesi was also voted one of Britain's Top 101 Female Public Intellectuals.

Appignanesi has been nominated for the Charles Taylor Prize, and the Jewish Quarterly-Wingate Literary Prize for her critically acclaimed family memoir Losing the Dead, while her novel The Memory Man was short-listed for the Commonwealth Writers' Prize and won the Canadian Holocaust Fiction Award. Mad, Bad and Sad was short-listed for the Warwick Prize and long-listed for the Samuel Johnson Prize, amongst others, and won several awards. With John Berger, she translated the work of Nella Bielski. The Year is 42 won the Scott Moncrieff Prize for Literary Translation.

In 1987 she was made a Chevalier of the Ordre des Arts et des Lettres. Her popular fictions are reminiscent of those of Lesley Glaister and Sally Beauman, while her psychological thrillers have been compared to those of Nicci French.

Lisa Appignanesi first married Richard Appignanesi, another writer, with whom she had one son, the film director Josh Appignanesi. The couple later divorced. Her later partner is John Forrester. Their child, Lisa Appignanesi's second, is Katrina Forrester, a PhD student in political thought at Cambridge.