An only child, Gallant was born in Montreal, Quebec. Her father died when she was young, and her mother remarried. Gallant received her education at seventeen different public, convent, and French-language boarding schools. In her twenties, she worked as a reporter for the Montreal Standard (1944-1950). She married John Gallant, a Winnipeg musician in 1942. The couple divorced five years later in 1947. Gallant left journalism in 1950 to pursue fiction writing.

Gallant has been candid about her need for autonomy and privacy. In an interview with Geoff Hancock in Canadian Fiction magazine in 1978, she discussed her “life project” and her deliberate move to France to write by saying, “I have arranged matters so that I would be free to write. It's what I like doing.” In the preface to her collection of stories, Home Truths: Selected Canadian Stories (1981), she uses the words of Boris Pasternak as her epigraph: “Only personal independence matters.”

In 1981, Gallant was honoured by her native country and made an Officer of the Order of Canada for her contribution to literature; that year, she received the Governor General's Award for literature for her collection of stories, Home Truths. In 1983-84, she returned to Canada to be the writer-in-residence at the University of Toronto. Queen’s University awarded her an honorary LL.D. in 1991. She was promoted to Companion of the Order of Canada in 1993.

In 1989, Gallant was made a Foreign Honorary Member of the American Academy of Arts and Letters. In 2000, she won the Matt Cohen Prize, and in 2002 she received the Rea Award for the Short Story. The O. Henry Prize Stories of 2003 was dedicated to her. In 2004, Gallant was awarded a Lannan Literary Fellowship.

With Alice Munro, Gallant is one of a few Canadian authors whose works regularly appear in The New Yorker. Many of Gallant’s stories have debuted in the magazine before subsequently being published in a collection.

Grazia Merler observes in her book, Mavis Gallant: Narrative Patterns and Devices, that “Psychological character development is not the heart of Mavis Gallant’s stories, nor is plot. Specific situation development and reconstruction of the state of mind or of heart is, however, the main objective.” Frequently, Gallant’s stories focus on expatriate men and women who have come to feel lost or isolated; marriages that have grown flimsy or shabby; lives that have faltered and now hover in the shadowy area between illusion, self-delusion, and reality. Because of her heritage and understanding of Acadian history, she is often compared to Antonine Maillet, considered to be a spokesperson for Acadian culture in Canada.

In her critical book Reading Mavis Gallant, Janice Kulyk Keefer says, “Gallant is a writer who dazzles us with her command of the language, her innovative use of narrative forms, the acuity of her intelligence, and the incisiveness of her wit. Yet she also disconcerts us with her insistence on the constrictions and limitations that dominate human experience.”

In a review of her work in Books in Canada in 1978, Geoff Hancock asserts that “Mavis Gallant's fiction is among the finest ever written by a Canadian. But, like buried treasure, both the author and her writing are to discover.” In the Canadian Reader, Robert Fulford has said, “One begins comparing her best moments to those of major figures in literary history. Names like Henry James, Chekhov, and George Eliot dance across the mind.”

Gallant has written two novels, Green Water, Green Sky (1959) and A Fairly Good Time (1970); a play, What is to be Done? (1984); numerous celebrated collections of stories, The Other Paris (1953), My Heart is Broken (1964), The Pegnitz Junction (1973), The End of the World and Other Stories (1974), Across the Bridge(1976), From the Fifteenth District (1978), Home Truths: Selected Canadian Stories (1981), Overhead in a Balloon: Stories of Paris (1985), and In Transit (1988); and a non-fiction work, Paris Journals: Selected Essays and Reviews (1986).

Although she maintains her Canadian citizenship, Gallant has lived in Paris, France since the 1950s.