Born and raised in Sydney, Tonkin began her career on Australian television and had her breakthrough playing Cleo Sertori in the Network Ten fantasy series H2O: Just Add Water (2006–2010), for which she received acclaim and was nominated for the AACTA Award for Best Actress.

After starring in the horror film Bait 3D (2012), she relocated to America, where she received acclaim for her roles as Faye Chamberlain in the CW supernatural drama series The Secret Circle (2011–2012) and Hayley Marshall in The Vampire Diaries (2012–2013) and The Originals (2013–2018).

[2] In 2005, Tonkin was cast in the role of Cleo Sertori on the Australian children's television series H2O: Just Add Water, which follows the lives of three teenage girls who turn into mermaids.

The film revolves around a group of teenagers waging a guerrilla war against an invading foreign power in their fictional hometown of Wirrawee.

[8] In March 2011, she was cast as Faye Chamberlain in The CW's supernatural drama series The Secret Circle,[9] which premiered on 15 September 2011 to over 3.5 million viewers.

In August 2012, Tonkin joined the cast of The CW television series The Vampire Diaries, in the recurring role of Hayley, a friend of Tyler's.

[18] On 15 May 2017, SBS announced that Tonkin had been cast in their new four-part drama Safe Harbour about a group of Australians on a sailing vacation who come across a boat of refugees.

[23][24] After her having expressed in interviews a desire to continue working in Australia,[25] it was announced on 20 August 2018 that Tonkin had been cast in Bloom, to be aired on the streaming platform Stan, as the young Gwen Reid, a character whose older version is portrayed by Jacki Weaver.

[28] In April 2021, it was announced that Tonkin would co-star in a horror film titled Night Shift, alongside Lamorne Morris and Madison Hu.

[30] In 2024, she starred as a struggling, drug addicted mother in Boy Swallows Universe, a Netflix coming of age miniseries based on the acclaimed semi-autobiographical novel of the same name by Trent Dalton.

"[32] Dalton, who wrote the eponymous novel the series is based on, also praised Tonkin's performance, stating "Phoebe went right ahead and gave a performance across eight hours of television that is so raw and exposing and true and dark-as-night-sometimes and so filled with light and hope and heart and LOVE that it reminded me why I wanted to write Boy Swallows Universe in the first place.

[40] In February 2024 it was announced that Tonkin would be starring in a new series adaption of the Sarah Bailey novel The Dark Lake, as the lead protagonist Gemma Woodstock.

[46] Tonkin has appeared as the face of New York-based stylist Ilona Hamer's swimwear line "Matteau Swim" from 2015 to 2017,[47] completing 3 seasons with the brand.

[51] In September 2017, Tonkin appeared in the ad campaign "Journey To The Wild Side" for Smythson to promote their latest product range.

[2] For the April 2018 issue of Vogue Australia, Tonkin underwent another photoshoot in partnership with Chanel makeup director Lucia Pica.

[63][64] She has also continually supported and worked with the group on social media to raise awareness against issues such as climate change and ocean pollution, with Tonkin saying "Growing up I was very conscious of my environmental footprint.

[68] In July 2024 it was announced that Tonkin had become a National Ambassador for the organisation's Australian counterpart, with a focus on supporting their Children in Crisis fund.