Karen Walker was born in December 1969 and grew up in the Auckland suburb of Remuera, attending Epsom Girls' Grammar School. She started her label in 1987, while still in her teens, and has led it ever since alongside her husband, Mikhail Gherman.

Her first store opened in Newmarket, Auckland, in 1995. In 1998 two milestones arrived together: she began selling to Barneys New York and showed her first runway collection. The label's tone, playful, intelligent and slightly off-kilter, found a natural audience abroad, and her clothes have been worn by Björk, Natalie Portman, Sienna Miller, M.I.A., Alexa Chung, Liv Tyler, Rihanna, Claire Danes and Zooey Deschanel. In film, she dressed Kate Winslet's character in Michel Gondry's Eternal Sunshine of the Spotless Mind. In late 2011 she entered a partnership with the American retailer Anthropologie.

She began, by her own account, with NZ$100 and two T-shirts. The breakthrough collection was a set of reworked business suits titled Daddy's Gone Strange, shown in Hong Kong in 1998 and picked up by Barneys; in 2000 she made her New York Fashion Week debut. The look the Business of Fashion described as a punchy, tomboyish edge, pairing neons with pastels and florals with military touches, earned her a reputation as a designer for anti-"It" girls. Her sunglasses became a cult business of their own, worn by Lady Gaga, Florence Welch and Beth Ditto, and by 2014 eyewear sales alone were estimated at more than $35 million. At its peak the brand was sold in 42 countries through stores including Barneys, Liberty and Harvey Nichols.

In 2016 she announced that her New York show would be her last runway. "There are just way better ways to talk to people now than ten years ago," she told Vogue Australia. Almost a decade later, in March 2025, she surprised the industry by announcing a return to a reimagined New Zealand Fashion Week: Kahuria in Auckland. "This vision has creativity at its heart," she said. "This vision is not 35 looks trotting up a runway."

Walker's interest in colour has carried her beyond clothing. She is regarded as an authority on colour for interiors and has created her own range of paint colours with the New Zealand paint company Resene.

New Zealand has honoured her repeatedly. She was appointed a Member of the New Zealand Order of Merit in the 2004 New Year Honours for services to the fashion industry, and promoted to Companion of the Order in 2014 for services to fashion design. In 2009 she received a World Class New Zealand Award in the creative category. In December 2024 she was appointed to the board of Creative New Zealand, the national arts development agency.

Thirty-five years on, she told Kea in 2024, the archive has become a working resource: "When we are designing we always have one eye on the archive." She has moved the business towards fair-trade organic cotton, recycled materials and smaller, often hyper-local partners, among them Rise Beyond the Reef, a Fijian non-profit supporting rural Indigenous women. In 2018 she represented New Zealand in the Commonwealth Fashion Exchange at Buckingham Palace.

Nearly four decades after founding it as a teenager, Walker's label stands as one of New Zealand's most successful fashion exports, proof that a distinctive point of view from Auckland could travel to New York and beyond.