Born Margaret Elizabeth McLachlan[a] on 28 May 1935 in Crystal Brook, South Australia,[2] Reid was educated at Balaklava Primary School,[4] Methodist Ladies' College and the University of Adelaide, where she was president of the debating society.

[5] Reid was admitted as a barrister and solicitor in the Supreme Court of South Australia in 1960[4] and worked in a family law practice in Adelaide.

[7] When Knight died in office in March 1981, Reid stepped forward as one of ten candidates hoping to fill the casual vacancy.

[7][5] The ACT Liberal Party endorsed Reid to replace Knight[4] over other candidates including experienced politicians John Haslem and Greg Cornwell.

[4] Reid has stated that she took this role because it was only active while Parliament was in session, and did not seek a ministry or position on a major standing committee as such would limit the time she could work with her electorate, which in turn could affect her chances at re-election.

[2][13] Reid became Deputy President and Chair of Committees (Senate) in July 1995,[1] after Noel Crichton-Browne was forced to resign from the position due to allegations of domestic violence.

Crichton-Browne had been poised to take the Senate Presidency on a Liberal–National Coalition victory in the 1996 election; in his absence, Reid was seen as a replacement that party members could work with.

[13] During her term as Senate President, Reid was re-elected twice, including her most-difficult contest in 1998, when the federal Liberal Party had lost popularity in the ACT.