[4] Peterson then worked as an associate attorney for a Spokane law firm from 1993 until 1994 and then was a sole practitioner in 1995.

[4][3] On October 13, 2009, President Barack Obama nominated Peterson to serve as a judge on the United States District Court for the Eastern District of Washington to a seat vacated by Judge Frederick L. Van Sickle, who assumed senior status on May 1, 2008.

Following the arrest of Anthony P. Bosworth on February 25, 2015,[7] Peterson authored new rules banning firearms and other weapons on the grounds surrounding the Thomas S. Foley Federal Court in Spokane.

[8] Bosworth's arrest and detention on February 25 led to an additional protest on March 6, 2015, where a large crowd defied the judge's order by appearing armed on the Foley Courthouse plaza.

[7] In 2019, Peterson made national headlines when she blocked the Trump Administration from implementing its changes to the “public charge” rule nationwide.