Williams-Paisley was born in Rye, New York, the daughter of Linda Barbara (née Payne), a fund-raiser, and Gurney Williams III, a health and science writer. She has a sister, Ashley, also an actress, and a brother, Jay. Williams has been in show business since the age of 13. In 1989 she directed the Rye High School Musical Revue. She left Northwestern University during her sophomore year to appear in the 1991 film version of Father of the Bride but returned to complete her degree in drama. While there she was a sister of the Alpha Phi sorority.
Her breakthrough role was Annie Banks in Father of the Bride (1991) and Father of the Bride Part II (1995), with Steve Martin and Diane Keaton.
She later appeared in Indian Summer (1993), Coldblooded (1995), The War at Home (1996), and in 1996 landed to lead role in ABC drama series Relativity. She won critical acclaim for her performance, but the series was canceled after 17 episodes due to low ratings. In 2000, Williams-Paisley starred as Virginia in the fantasy miniseries The 10th Kingdom.
From 2001 to 2008, Williams-Paisley played the role of Dana in the ABC sitcom According to Jim, opposite Jim Belushi and Courtney Thorne-Smith. She left the show after its seventh season, but she came back for the show's final episode in 2009. On stage, Williams-Paisley replaced Arija Bareikis as Sunny in The Last Night of Ballyhoo, written by Alfred Uhry (of Driving Miss Daisy fame) sometime later in the play's February 1997 to June 1998 run. In 2000s, she also starred in number of made for television movies, and also guest starred on Less than Perfect, Boston Legal, and Royal Pains. In film, she starred opposite Matthew McConaughey in 2006 drama We Are Marshall.
In March 2015, Williams-Paisley was cast in Alvin and the Chipmunks: The Road Chip.
In March 2003 Williams married country music singer Brad Paisley. In February 2007, she gave birth to their first child, a son named William Huckleberry Paisley, also known as "Huck," in Nashville, Tennessee. In April 2009, they welcomed their second son, Jasper.