Dangarembga was born in Bulawayo, Rhodesia (now Zimbabwe), on 4 February 1959 but spent part of her childhood in England. She began her education there, but concluded her A-levels at Hartzell High school, a missionary school in the Rhodesian town of Umtali (now Mutare). She later studied medicine at Cambridge University but, unable to put up with the racism and isolation she experienced in England, returned to Zimbabwe a few months before the country officially founded their independence.

She took up psychology at the University of Zimbabwe while holding down a two-year job as a copywriter at a marketing agency. This early writing experience gave her an avenue for expression: she wrote numerous plays, including The Lost of the Soil, and then joined the theatre group Zambuko. She participated in the production of two plays, Katshaa and Mavambo.

In 1985, Dangarembga published a short story in Sweden called "The Letter". In 1987, she published the play She Does Not Weep in Harare. At the age of 25, she had her first taste of success with her novel Nervous Conditions, which won the African section of the Commonwealth Writers' Prize in 1989 and is considered one of the twelve best African novels ever written. Asked about her subsequent prose drought, she explained: "There have been two major reasons for my not having worked on prose since Nervous Conditions: firstly, the novel was published only after I had turned to film as a medium; secondly, Virginia Woolf's shrewd observation that a woman needs £500 and a room of her own in order to write is entirely valid. Incidentally, I am moving and hope that, for the first time since Nervous Conditions, I shall have a room of my own. I'll try to ignore the bit about £500."

Dangarembga continued her education later in Berlin at the Deutsche Film- und Fernsehakademie, where she studied film direction and produced several film productions, including a documentary for German television. She also made the film Everyone's Child, shown worldwide including at the Jameson Dublin International Film Festival.

She founded the International Images Film Festival in 2002 in response to the proliferation of beauty contests at that time, to provide diverse narratives by and about women.

In May 2016, she was selected by the Rockefeller Foundation Bellagio Center for their 2015 Artists in Residency Programme