[1] She resigned from Cabinet on 20 February 2004 after apparently lying about a leak of documents to the media, but was reinstated as a Minister following Labour's return to office after the 2005 election.

Dalziel entered Parliament as a Labour Party MP for Christchurch Central in 1990, replacing outgoing former Prime Minister Geoffrey Palmer.

After the 2005 election, Dalziel was re-elected by her caucus colleagues to Cabinet and was given the portfolios of Commerce, Small Business, and Women's Affairs.

Mike Williams, President of the Labour Party from 2000 to 2009, states that he was surprised by Clark appointing Dalziel Minister of Commerce and thought of it as an "odd choice".

[3] Tim Barnett, MP for Christchurch Central from 1996 to 2008 credits her training as a lawyer and "having a bigger brain than most of us" for her success.

[3] Williams states that as Minister of Commerce, Dalziel worked closely with National's Simon Power and built "cross-party unity on various issues".

[3] Dalziel's position became difficult after she was accused of giving certain documents to the press to bolster the case for a decision her Associate Minister had made.

The editorial also speculated that she might reconsider her political future:[12] The demotion is bound to concentrate Dalziel's mind on whether she should run for the Christchurch mayoralty.

As things stand, a place for her in a Labour cabinet as minister for the earthquake recovery looks unlikely, but she would be a strong candidate for mayor.Following months of speculation, The Press reported on 20 April 2013 that Lianne Dalziel would challenge Parker for the mayoralty, and that she had asked 24-year-old Student Volunteer Army organiser Sam Johnson to be her running mate, with a view of Johnson becoming deputy mayor.

[14] On 19 June, Dalziel formally confirmed that she would contest the mayoralty, also announcing that she would resign from Parliament, which would trigger a by-election in the Christchurch East electorate.

[3] Although some expressed concerns about Dalziel's Labour Party background, including central city property developer Antony Gough, who talked of her "red apron strings" getting in the way of working with local business owners,[3] she also nevertheless open support from the political right for her mayoral ambitions:[3] Christchurch City Councillor Tim Carter, son of Christchurch property developer Philip Carter and nephew of Speaker David Carter, encouraged her to stand for the mayoralty;[18] former National Party cabinet minister Philip Burdon was one of her nominees when she lodged her nomination for the mayoralty with the returning officer;[19] and blogger Cameron Slater, by many considered a "conduit for factions of the National Party"[3] wrote:[3][20] Christchurch needs a uniter, not a divider, and the word is that National would far rather deal with Lianne and the competent councillors she is bringing with her than Bob Parker.Dalziel's Earthquake Recovery portfolio in Labour's shadow cabinet was split and given to Ruth Dyson and Clayton Cosgrove.

Two complainants, including rival mayoral candidate John Minto, had filed a complaint regarding donations by six people that exceeded the $1,500 limit under the Local Electoral Act.

"[32] In the 2023 King's Birthday and Coronation Honours, Dalziel was appointed a Companion of the New Zealand Order of Merit, for services to local government and as a Member of Parliament.