Born in South Carolina and raised in Houston, Texas, Davis enjoyed an early life of wealth, privilege, and Southern gentility. After a brief stint at Vassar College, she earned her bachelor's degree (and later a master's degree in literature) from Rice Institute (now University).

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Like many women of her generation and class, Arnold was married soon after graduation to her classmate Gilbert Harrington Arnold and quickly had four children. However, her marriage failed in the 1950s, and she moved with her children to Greenwich Village in New York with the intent of becoming a writer.

Arnold immersed herself in the rich cultural diversity of the Village. There she established her feminist as well as lesbian identity--matter-of-factly, without drama, but with eloquence. Her first novel, Applesauce (1966), dealt in part with her marriage and her difficulty in fulfilling the traditional roles expected of a woman, wife, and mother. The book established Arnold as a writer of lesbian feminist themes.

In Greenwich Village, Arnold also began a relationship with Parke Bowman, a lawyer who became her long-time partner. Bowman and Arnold moved to Vermont, where, with novelist Bertha Harris and political theorist Charlotte Bunch, they founded Daughters Inc., Press in 1973. In its five brief years of existence, Daughters Inc. published thirty titles, most notably Rita Mae Brown's groundbreaking Rubyfruit Jungle (1973) and Harris's innovative Lover (1976). The press also published Arnold's next two acclaimed novels.

In The Cook and the Carpenter, a Novel By the Carpenter (1973), a pioneering work of lesbian feminist fiction, Arnold deliberately obscures and subverts the gender of the characters, replacing all gender pronouns with the made-up terms na and nan.

Sister Gin (1975) is Arnold's best-known work, celebrated for its articulation of aging lesbians and vivid descriptions of the menopausal experience. It is a difficult read; the nonlinear narrative is experimental in style and occasionally hard to follow. In Sister Gin, Arnold tackles other issues that plague the lesbian community, including alcoholism, infidelity, and struggles with weight. She refuses to make her characters easy and likable; rather, she writes them as complexly human and wholly believable.

Arnold helped to organize the first Women in Print conference in Omaha, Nebraska, in August 1976, and contributed to many mainstream and alternative journals and newspapers, including the Village Voice and the Houston Post. She was a member of PEN, the National Organization of Women (NOW), and the Texas Institute of Letters.

In 1978, after Daughters, Inc. declared bankruptcy, Arnold returned with Bowman to her childhood environs to write Baby Houston (1987), a book about her hometown and her mother. She took the extraordinary step of attempting to inhabit her mother's life in order to write not a biography but a novel from her mother's point of view. Baby Houston was published five years after Arnold's premature death from cancer at the age of fifty-five.

Arnold's legacy is that of a courageous pioneer whose writings give voice to complicated characters who previously had no voice in literature.

Since Stonewall various political agendas have dominated American lesbian literature.

The gay and lesbian press is of prime importance in sustaining a frequently embattled minority and has been crucial in the development of a national mass movement for gay rights.

From the great modernist writers of the 1920s and 1930s to the pulp writers of the 1950s to the lesbian writers of today, lesbian novelists have had a powerful impact on the lesbian community.

Lesbian poet and novelist Rita Mae Brown, best known for the highly successful Rubyfruit Jungle, resists neat categorization.

The novelist Bertha Harris has been credited with creating what was called a "new lesbian fiction."