Nancy Ann Olson was born in Milwaukee, Wisconsin, to Henry, a physician, and Evelyn Olson. She received her education at the University of Wisconsin before being discovered on stage in California, where she was signed by Paramount Studios in 1948.
Olson's early film career included an uncredited bit part in Portrait of Jennie (1948) and co-starring roles in Canadian Pacific (1949) and Sunset Boulevard (1950),for which she received an Oscar nomination for Best Supporting Actress.
Her pairing with William Holden in Sunset Boulevard went so well that they were teamed in a series of standard features, including Union Station (1950),Force of Arms (1951),and Submarine Command (1951). She also co-starred with John Wayne, Steve Forrest, and Will Rogers Jr. in other films.
However, Olson's career slowed down in the mid-1950s after she married renowned lyricist Alan Jay Lerner. She put her acting career on hold to raise their two daughters and the couple divorced in 1957.
Olson returned to acting in the early 1960s, playing Fred MacMurray's love interest in The Absent Minded Professor (1961) and Son of Flubber (1962) for Disney Studios. She also appeared in Pollyanna (1960) and Snowball Express (1972),as well as an uncredited cameo in the Flubber (1997) remake.
In addition to her film work, Olson found success on Broadway, starring in plays such as The Tunnel of Love, Send Me No Flowers, and Mary, Mary. She also appeared in a few TV shows in the 1970s and 1980s before retiring in the mid-1980s.
Olson's second marriage, to record executive Alan Livingston, lasted over 47 years until his death in 2009. The couple had a son, Christopher Livingston, who has worked in the film industry as a director, editor, cinematographer, producer, and actor.