Born into an Irish Catholic show-business family, Allen was educated at the Star of the Sea Convent School as a girl, and then became a vaudeville performer with her sister Bessie in 1909. She teamed up with George Burns in 1922, and married him in 1926. In the 1930s they adopted two children: Sandra Jean and Ronald "Ronnie" John; when Ronnie was grown, he joined the cast of his parents' 1950-1958 Monday-night television show on CBS, The George Burns and Gracie Allen Show. Allen's stage persona was as a bizarre, illogical, and not very bright woman. Offstage she was anything but dimwitted, however: Historians credit her with having the genius to deliver her lengthy diatribes in a fashion that made it look as though she was making her arguments up on the spot.
She and Burns were deeply devoted to each other. After her death, Burns told a reporter that he had received a number of letters asking why he remained married to "that fruitcake". Burns replied to them by publishing a book titled: I Love Her, That's Why.
Allen had one green eye and one blue one. At least one biographer has speculated that her sensitivity about that was what caused her to retire from television when color television came in, which would have revealed that feature to her fans. She had stopped making films in the early 1940s when color movies came in, too.