Karen Morley lived until the age of 13 in Ottumwa, Iowa, and moved to Los Angeles, where she attended Hollywood High School with her family. After school, she studied medicine, but then came to theater courses to acting. She broke off his studies and began studying acting at the Pasadena Playhouse. Director Clarence Brown, she discovered for the film, as he samples tested substitute for Greta Garbo. Her first appearance was in 1931 in his film Yvonne. Karen Morley was then given a contract with Metro-Goldwyn- Mayer, 1931 was voted one of the WAMPAS Baby Stars of the Year and selected in 1932 by Howard Hughes for the role of "Poppy " in Scarface. In 1934 came the break with MGM. In the same year she turned with King Vidor, who entrusted our daily bread with the lead role in his New Deal propaganda film. She played from that time only in a few films, as it was impossible at that time without the support of a major movie studios to make film career.
Karen Morley was a member of the Communist Party USA. Among other things, by Robert Taylor, a member of the anti-communist Motion Picture Alliance for the Preservation of American Ideals, denounced it in 1952 charged before the Committee on Un-American Activities. They refused to testify before the committee, what their career from Hollywood meant.
Karen Morley was married from 1932 to 1943 with Charles Vidor. Their son, Michael Karoly was born in 1933. After separating from Vidor, she married actor Lloyd Gough 1943, with whom she was married until his death in 1984.