Margaret Mahy was born in Whakatane, New Zealand, where she was the oldest of five children in her family. This may explain why family life dominates so much of her stories.

She has received a Bachelor of the Arts degree from the University of New Zealand. She has worked as an assistant librarian and a librarian and has been a writer full-time since 1980. She specializes in children's books.

Margaret Mahy has won several awards, including the Esther Glen Medal of the New Zealand Library Association in 1983 for The Haunting and the Carnegie Medal for The Haunting in 1982, The Changeover: A Supernatural Romance in 1986 and The Memory in 1987.