Silverman was born in Bedford, New Hampshire, to Beth Ann (nee Halpin; 1941-2015) and Donald Silverman. She was raised in Manchester, New Hampshire. Beth had been George McGovern's personal campaign photographer and would found the theater company New Thalian Players, while Donald has training as a social worker and also ran the clothing store Crazy Sophie's Outlet. Silverman's parents divorced and later remarried others.

Her television sitcom The Sarah Silverman Program debuted on Comedy Central in February 2007, the series had 1.81 million viewers and portrays the day-to-day adventures of fictionalized versions of Silverman, her sister Laura, and their friends. A number of comedic actors from Mr. Show have appeared on The Sarah Silverman Program. Silverman was nominated for a Primetime Emmy Award for her acting on the show. At the awards ceremony, she wore a fake mustache. Comedy Central canceled The Sarah Silverman Program after three seasons.  In June 2007, she hosted the MTV Movie Awards. During her opening act, she commented on the upcoming jail sentence of Paris Hilton, who was in the audience, saying: "In a couple of days, Paris Hilton is going to jail. As a matter of fact, I heard that to make her feel more comfortable in prison, the guards are going to paint the bars to look like penises. I think it is wrong, too. I just worry she is going to break her teeth on those things." In September 2007, she appeared at the MTV Video Music Awards. Following the comeback performance of Britney Spears, Silverman mocked her on stage, saying: "Wow, she is amazing. I mean, she is 25 years old, and she has already accomplished everything she's going to accomplish in her life."  In January 2008, she appeared on Jimmy Kimmel Live! to show Jimmy Kimmel, her boyfriend at the time, a special video. The video turned out to be a song called "I'm Fucking Matt Damon" in which she and Matt Damon sang a duet about having an affair behind Kimmel's back. The video created an "instant YouTube sensation." She won an Emmy Award for Outstanding Music and Lyrics at the 60th Primetime Emmy Awards. Kimmel responded with his own video a month later with Damon's friend Ben Affleck, which enlisted a panoply of stars to record Kimmel's song "I'm Fucking Ben Affleck". On September 13, 2008, Silverman won a Creative Arts Emmy Award for writing the song "I'm Fucking Matt Damon". Silverman guest-starred in a second-season episode of the USA cable program Monk as Marci Maven. She returned in the sixth-season premiere and for the 100th episode of Monk. According to the audio commentary on the Clerks II DVD, director Kevin Smith offered her the role that eventually went to Rosario Dawson, but she turned it down out of fear of being typecast in "girlfriend roles". However, she told Smith the script was "really funny" and mentioned that if the role of Randal Graves was being offered to her she "would do it in a heartbeat." She appeared in Strange Powers, the 2009 documentary by Kerthy Fix and Gail O'Hara about cult songwriter Stephin Merritt and his band The Magnetic Fields. Silverman wrote a comic memoir, The Bedwetter: Stories of Courage, Redemption, and Pee, which was published in 2010.

What did she do after The Sarah Silverman Program ended?
In June 2007, she hosted the MTV Movie Awards.