She has written fourty books, including the best-selling children's novel The Indian in the Cupboard, which has sold over 10 million copies and has been successfully adapted to film. Her first novel, The L-Shaped Room, published in 1960, was an instant and lasting best seller. The L-Shaped Room was later made into a movie of the same name and led to two sequels, The Backward Shadow and Two is Lonely. Banks also wrote a biography of the Brontë family, entitled Dark Quartet, and a sequel about Charlotte Brontë, Path to the Silent Country.
Banks was born in London, the only child of James and Muriel Reid Banks. She was evacuated to Saskatoon, Saskatchewan, Canada during World War II but returned after the war was over. She attended St Teresa's School in Surrey. Prior to becoming a writer, Banks was an actress, and also worked as a television journalist in Britain, one of the first women to do so.
In 1962 Banks emigrated to Israel, where she taught for eight years on an Israeli kibbutz Yas'ur. In 1965 she married Chaim Stephenson, a sculptor, with whom she had three sons; Adiel, Gillon and Omri Stephenson with whom she has recently collaborated on two picture books (see below). She now lives with her husband in Shepperton, near London, UK.
Although the family returned to England in 1971, the influence of her time in Israel can be seen in some of her books (including One More River and its sequel, Broken Bridge - and other books such as An End to Running and Children at the Gate) which are set partially or mainly on kibbutzim.