Her father, Rupert Potter, although educated as a barrister, spent his days at Gentlemen's clubs and rarely practised. Her mother spent her time visiting or receiving visitors. Both parents lived on incomes (inheritances) from their parents. Nannies and governesses raised Beatrix and her younger brother, Bertram. When she came of age, her parents appointed her their housekeeper and discouraged any intellectual development, instead requiring her to supervise the household. An uncle attempted to introduce her as a student at the Royal Botanical Gardens at Kew, but she was rejected because she was female.

The basis of her many projects and stories were the small animals that she smuggled into the house or observed during family holidays in Scotland and the Lake District.

Potter was one of the first to suggest that lichens were a symbiotic relationship between fungi and algae, but her one attempt to publish was thwarted. Her uncle had to read her paper at the scientific society because they did not admit females. At the time the only way to record micrscopic images was by painting them and her pictures of fungi have been widely admired.

She was encouraged to publish her story, The Tale of Peter Rabbit, but she struggled to find a publisher until it was accepted in 1902. The small book and her following works were extremely well received and she gained an independent income from the sales. She also became secretly engaged to the publisher, Norman Warne, but her parents were set against her marrying anyone who worked for a living. He died before the wedding, causing a breach between Beatrix and her parents.

Potter wrote 23 books. These were published in a small format, easy for a child to hold and read. Her writing efforts abated around 1920 due to poor eyesight, though her last major work, The Tale of Little Pig Robinson, was published in 1930.

In her later years she bought and ran a sheep farm in the English Lake District; she loved the landscape, and with the steady stream of royalties from her books, along with the inheritance from her parents, she bought up large areas of local land. She had been a friend of one of the founders of the National Trust, and in her will, much of the property was left to the Trust — cottages, 15 farms, 4000 acres (16 km²) of land — to ensure that its beauty could remain unspoiled. Her legacy is now part of the Lake District National Park.

At the age of 47, Beatrix Potter married her solicitor, William Heelis; they had no children. She died in Sawrey, Lancashire on December 22, 1943.