Collette Dinnigan was born in South Africa on 24 September 1965. When she was eight, her family took to the water, living aboard their yacht for several years and sailing along Australia's southern coast to New Zealand, where they settled. She studied fashion design at Wellington Polytechnic, then moved to Sydney, where she worked in the costume department of the Australian Broadcasting Corporation, an apprenticeship in construction, fabric and the demands of the camera.

She launched her own business in 1990 with a collection of dry-clean-only lingerie. The business grew from lingerie into ready-to-wear, evening and bridal.

In 1995 Dinnigan became the first Australian designer to present a ready-to-wear collection in Paris, and the first to be invited onto the official Paris ready-to-wear schedule. The achievement made her a pioneer for the Australian labels that later followed her to Paris. Her collections were sold through her own boutiques in Sydney, Melbourne and London and through David Jones at home, and internationally through Barneys New York and Harvey Nichols in London and Hong Kong. In 2001 she opened a store in Paddington, Sydney.

In 2002 Marks & Spencer invited her to create a branded lingerie line, Wild Hearts by Collette Dinnigan, for its stores, with Target carrying it in Australia; the range performed strongly. In 2005 she was among six designers honoured on Australia Post's Australian Legends stamps, alongside Carla Zampatti, Akira Isogawa, Joe Saba, Jenny Bannister and Prue Acton.

At the end of 2013, after more than two decades, she significantly scaled the business back, closing her boutiques in Sydney, Melbourne and London and ending production of bridal and evening wear. She was clear that the company was profitable and free of debt, and that the decision was about spending more time with her family.

Her Paris debut, a full-scale ready-to-wear collection in October 1995, was followed in 1996 by an invitation from the Chambre Syndicale to join the official Paris Fashion Week schedule; in 2008 she was invited onto the organisation's executive board. She was named Australian Designer of the Year in 1996 and won Louis Vuitton's Business Award in 1997 and Fashion Group International's Award for Excellence in 1998. In 2000 the Victoria and Albert Museum presented her work in its Fashion in Motion series. Her bridal collection was stocked by Barneys New York and Browns, and her clients included Crown Princess Mary of Denmark, the Princess of Wales, Nicole Kidman, Angelina Jolie and Beyoncé. In 2012 she received the Australian Fashion Laureate, and in 2015 the Powerhouse Museum opened Collette Dinnigan: Unlaced, the first designer exhibition at its Centre for Fashion. She was appointed to the Order of Australia in 2017.

Since closing her boutiques she has moved into interiors and publishing: penthouse suites at Bannisters by the Sea, wallpaper for Porter's Paints, linen with Linen House, eyewear with Specsavers and a hand-painted ceramics range inspired by Puglia and Basilicata. Her books include Obsessive Creative (2013), children's titles and Bellissima: An Australian–Italian Affair (2024).

Her place in the history of Australian fashion is secure: She proved that an Australian designer could show on the Paris calendar and hold her own there. In 2026 she announced a further book, A Journey Home, about her first return to South Africa since childhood.