Laubenstein was raised in Barrington, Rhode Island, where a childhood bout of polio left her paraplegic and using a wheelchair for the rest of her life.

[2] A specialist in hematology and oncology, and clinical professor at the New York University Medical Center, Laubenstein was one of the first in the United States to recognize the appearance of the AIDS epidemic.

[3][6] While working in private practice in New York City, she observed a sudden increase in the number of cases of Kaposi's sarcoma—a rare cancer that would later be identified as an AIDS-defining illness—in young gay men with immune deficiencies.

In 1981, when Dugas, a Canadian, heard about Kaposi's sarcoma, he traveled to New York from Montreal to consult with Laubenstein and Friedman-Kien and visited their practice for monthly chemotherapy treatments.

[1] A collection of research presented at the conference was published in 1984 in a volume titled AIDS: The Epidemic of Kaposi's Sarcoma and Opportunistic Infections, edited by Laubenstein and Friedman-Kien.

[2] The organization, which provided office services to businesses, employed AIDS patients who had lost their jobs because of the disease and helped them to find new positions.

[3] At a time when many physicians refused to see AIDS patients, Laubenstein's colleague James Wernz, an oncologist, affectionately noted that she was sometimes referred to as "bitch on wheels" because of her "pushy" attitude towards other doctors.

[1][3] Playwright Larry Kramer, who befriended Laubenstein after she cared for his partner, who died from AIDS, said that she was "probably the first doctor to suggest that we [gay men] stop having sex altogether".

She started taking corticosteroids for her respiratory problems, which were exacerbated by allergies to her two pet cats, and was unable to wean herself off them despite experiencing side effects.

[3] Larry Kramer's play The Normal Heart, about the AIDS epidemic of the early 1980s in New York City, features a wheelchair-using medical doctor, Emma Brookner, who is based on Laubenstein.