Chae Shi-ra made her acting debut in the 1983 KBS series A Diary of High School Students. In 1990, she won the Best New Actress for TV at the 26th Baeksang Arts Awards for her performance in the 1989 MBC drama The Giant. In 1991, she took the lead in the MBC series Eyes of Dawn. The series reached a peak viewership rating of 58.4 percent, making it one of the highest-rated Korean dramas of all time. She was named Best Actress for TV at the 28th Baeksang Arts Awards for her performance in the drama. She then won back-to-back Daesangs at the 1994 and 1995 MBC Drama Awards for The Moon of Seoul and Apartment. She won another Daesang at the 1999 KBS Drama Awards for The King and Queen. Her success in the 1990s made her one of the top actresses of that era along with Kim Hee-ae and Ha Hee-ra. She continued to collect numerous acting trophies for her succeeding dramas, including Empress Cheon-chu, Unkind Women, and Goodbye to Goodbye.

Chae Shi-ra has been married to Kim Tae-wook since 2000. They have a son and a daughter. Kim Tae-wook is the CEO of a wedding company that successfully transformed into a color cosmetics business.