Jones was born in Baltimore, Maryland to an African American father and mother of mixed Euro-American and Caribbean descent. Her multicultural background and upbringing in Boston, Washington DC, and Queens, New York, influenced her development into what The New Yorker termed a "multicultural mynah bird [who] lays our mongrel nation before us with gorgeous, pitch-perfect impersonations of the rarely heard or dramatized."

Jones attended The United Nations International School and Bryn Mawr College where she was the recipient of the Mellon Minority Fellowship. She originally planned a career as a lawyer, but left college early and eventually found her way to the Nuyorican Poets Cafe, NYC, where she began competing in poetry slams.

Her first solo show, Surface Transit, debuted at the Nuyorican Poets Cafe in 1998. It featured monologues based on her poetry which she performed in character. After gaining the attention of feminist icon Gloria Steinem and human rights organization Equality Now, Jones was commissioned by the organization to write and perform her next project, Women Can't Wait!, to address discriminatory laws against women.

A second commission for the National Immigration Forum to raise awareness about immigrant rights issues yielded Waking the American Dream, the solo show that became the basis for Bridge & Tunnel, which set an Off-Broadway box office record during its six-month, sold-out run in New York in 2004.

In 2005, a commission from the W.K. Kellogg Foundation to raise awareness of ethnic and racial health disparities in the U.S. resulted in A Right to Care, Jones' fourth solo piece, which premiered in 2005 at the Kellogg Foundation's 75th Anniversary conference alongside keynote speaker President Jimmy Carter.

Jones recently returned to her UN School roots by becoming an Ambassador for UNICEF as its first ever Official Spokesperson on Violence Against Children, traveling and performing for audiences from Indonesia to Ethiopia, the Middle East and Japan.

A recipient of the 2007 Brendan Gill Prize, Jones has also received grants and commissions from The Ford Foundation, NYSCA, and others, as well as a Helen Hayes Award, two Drama Desk nominations, and HBO's US Comedy Arts Festival's Best One Person Show Award, and an NYCLU Calloway Award in recognition of Jones as the first artist in history to sue the Federal Communications Commission for censorship. The lawsuit resulted in reversal of a censorship ruling, which had targeted her hip-hop poem recording “Your Revolution" in which she makes a powerful statement against sexual exploitation of women in hip hop music.

A regular guest on public radio, Jones has also made numerous TV appearances on programs including Charlie Rose, The Today Show, CBS Sunday Morning, Live with Regis and Kelly, and Sesame Street as ‘Mr. Noodle's Other Sister, Ms. Noodle’ on Elmo’s World. Jones is currently at work on a commission for Lincoln Center Theater and is developing a feature based on her characters for HBO Films.

Punk rock band, Ten Foot Pole wrote a song about Sarah Jones on their fifth album, Bad Mother Trucker.

Most recently, Jones was invited by First Lady Michelle Obama to perform at The White House in celebration of Women’s History Month.