Miranda was born Maria do Carmo Miranda da Cunha in Varzea da Ovelha e Aliviada, a village in the northern Portuguese municipality of Marco de Canaveses. She was the second daughter of Jose Maria Pinto da Cunha (17 February 1887 - 21 June 1938) and Maria Emilia Miranda (10 March 1886, Rio de Janeiro - 9 November 1971). In 1909, when Miranda was ten months old, her father emigrated to Brazil and settled in Rio de Janeiro, where he opened a barber shop.

Miranda performed at the New Frontier Hotel in Las Vegas in April 1955, and in Cuba three months later before returning to Los Angeles to recuperate from a recurrent bronchial ailment. On 4 August, she was filming a segment for the NBC variety series The Jimmy Durante Show. According to Durante, Miranda had complained of feeling unwell before filming; he offered to find her a replacement, but she declined. After completing "Jackson, Miranda, and Gomez", a song-and-dance number with Durante, she fell to one knee. Durante later said, "I thought she had slipped. She got up and said she was outa [sic] breath. I told her I'll take her lines. But she goes ahead with 'em. We finished work about 11 o'clock and she seemed happy."  After the last take, Miranda and Durante gave an impromptu performance on the set for the cast and technicians. The singer took several cast members and some friends home with her for a small party. She went upstairs to bed at about 3 a.m. Miranda undressed, placed her platform shoes in a corner, lit a cigarette, placed it in an ashtray and went into her bathroom to remove her makeup. She apparently came from the bathroom with a small, round mirror in her hand; in the small hall which led to her bedroom, she collapsed with a fatal heart attack. Miranda was 46 years old. Her body was found at about 10:30 a.m. lying in the hallway. The Jimmy Durante Show episode in which Miranda appeared was aired two months after her death, on 15 October 1955, and a clip of the episode was included in the A&E Network's Biography episode about the singer.  In accordance with her wishes, Miranda's body was flown back to Rio de Janeiro; the Brazilian government declared a period of national mourning. About 60,000 people attended her memorial service at the Rio town hall, and more than half a million Brazilians escorted her funeral cortege to the cemetery.  Miranda is buried in Sao Joao Batista Cemetery in Rio de Janeiro. In 1956 her belongings were donated by her husband and family to the Carmen Miranda Museum, which opened in Rio on 5 August 1976. For her contributions to the television industry, Miranda has a star on the Hollywood Walk of Fame at the south side of the 6262 block of Hollywood Boulevard.

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