McDonald came to the 1988 Seoul Olympics as one of the fancied competitors in the 800m freestyle, and claimed the bronze medal, behind Janet Evans and East Germany's Astrid Strauss.

McDonald was the subject of controversy at the 1990 Commonwealth Games in Auckland when she apparently showed disdain at the selection of fellow distance swimmer, the flame-haired Janelle Elford.

McDonald proceeded to win gold and silver medals in the 800- and 400-metre freestyle events, finishing one position ahead of Elford in both cases.

The Queensland swimmer finally got her recognition, when she was named as the Australian swimming captain for the 1991 World Championships in Perth.

In June 2006 Julie received a Queens Birthday Award, an OAM for her services to Swimming, The Olympic Movement and Charities.