Manheim became interested in acting after working at a Renaissance Faire in high school. Manheim graduated from New York University with a Master's degree in Fine Arts in 1987.

She previously worked as a sign language interpreter at hospitals. Her knowledge of sign language was utilized at times on The Practice and also for her role as a Child Behavioral Psychologist in the movie Mercury Rising. Manheim won an Emmy award for her work on The Practice and exclaimed that "This is for all the fat girls!"

She followed up on this statement with an autobiography entitled Wake Up, I'm Fat!. A one-woman show of the same title preceded the book.

Manheim is an avid human rights activist with a focus on women's rights and gay rights. She is known to have made contributions to a variety of charities, notably RAINN. She maintains her own official website where she can interact with fans.

She has a son named Milo. Her brother, Karl Manheim, is a law professor at Loyola Law School.

In 2005, Manheim earned a Golden Globe nomination for Best Performance by an Actress in a Supporting Role in a Series, Mini-Series, or Motion Picture Made for Television, for her work in Elvis.