She was educated at Delhi University and Harvard University. Her debut feature film, Salaam Bombay! (1988), won the Golden Camera award at the Cannes Film Festival and also earned the nomination for Academy Award for Best Foreign Language Film. She used the proceeds of the film, to establish an organization for street children, called the Salaam Baalak Trust in India. She often works with longtime creative collaborator, screenwriter Sooni Taraporevala, whom she met at Harvard.

She has won a number of awards, including a National Film Award and various international film festival awards, and was a nominee at the Academy Awards, Golden Globes, BAFTA Awards and Filmfare Awards. She was also awarded the India Abroad Person of the Year-2007, which was presented by Indra Nooyi, Chairperson and CEO, PepsiCo, Inc, and India Abroad Person of the Year-2006.

Her most recent films included Vanity Fair with Reese Witherspoon, The Namesake, and Amelia.

Mira Nair was born in Rourkela in a Punjabi Family, Orissa, where her father was employed. She was the youngest of three children from a middle-class family. Her father was a civil servant and her mother a social worker.

Mira did her early schooling at a boarding school, Loreto Convent Tara Hall in Shimla Himachal Pradesh. She studied sociology at Miranda House, Delhi University, where she became involved in political street theater and performed for three years in an amateur drama company. In 1976, at age 19 she left for the US with a scholarship at Harvard, where she continued her studies in sociology. While at Harvard she met her husband, photographer Mitch Epstein, as well as her screenwriter, Sooni Taraporevala and gradually moved towards making documentary films.

At the beginning of her career as a film artist, Nair directed four television documentaries. India Cabaret, a film about the lives of strippers in a Bombay nightclub, won the Blue Ribbon award at the 1986 American Film Festival. Salaam Bombay! (1988), with a screenplay by Sooni Taraporevala, was nominated for an Academy Award for Best Foreign Language Film and won many other awards. It is today considered a groundbreaking film classic, and is standard fare for film students.

The 1991 film Mississippi Masala starred Denzel Washington and Sarita Choudhury, and profiled a family of displaced Ugandan-Indians living and working in Mississippi. The screenplay was again by Sooni Taraporevala, and produced by Michael Nozik. In 1995 her film adaption of the book The Perez Family, by Christine Bell, was released. The film starred Marisa Tomei, Alfred Molina, and Angelica Huston, and was again produced by Michael Nozik.

She was also the director of the movie Kama Sutra: A Tale of Love a provocative movie set in 16th century India. My Own Country starring Naveen Andrews, was produced for HBO Films, adapted from the memoir by Abraham Verghese by Sooni Taraporevala.

Nair's most popular film to date, Monsoon Wedding (2001), about a chaotic Punjabi Indian wedding with a screenplay by Sabrina Dhawan, was awarded the prestigious Golden Lion award at the Venice Film Festival. Nair is the first woman that has won the award. Her 2004 version of Thackeray's novel Vanity Fair starred Reese Witherspoon.

Her film, The Namesake, premiered in fall 2006 at Dartmouth College where Nair was presented with the Dartmouth Film Award. Another premiere was held in fall 2006 with the Indo-American Cultural Council in New York. The Namesake, adapted by Sooni Taraporevala from the novel by Pulitzer Prize winner Jhumpa Lahiri, was released in March 2007.