Coupland was born in Leeds, West Riding of Yorkshire in 1928, the only child of Elsie (née Beck) and Denis Coupland. She originally wanted to be a ballet dancer, but could not fulfill this ambition due to a horse-riding accident. Her music career began at the age of 11. Barney Colehan, a BBC producer, heard Coupland sing and invited her onto one of his radio shows. By the time she reached 14, she was singing full-time at the Mecca Locarno in Leeds, and the following year, moved to London with her parents, where she became a resident singer at Mecca's Tottenham Court Road ballroom. During the 1940s and 1950s, she became a leading singer of the day, singing at the Dorchester Hotel and the Savoy Hotel. Coupland also dubbed the singing voices of actresses who could not sing, namely Lana Turner in Betrayed, and was most famously heard performing the song "Under the Mango Tree" in the first James Bond film Dr. No. She gave up professional singing in the 1960s.
Coupland serenades the opening scene of the film Flannelfoot (1953) where she starred as a nightclub singer. In 1959, she was unexpectedly cast by Joan Littlewood as Sally in the Theatre Workshop musical Make Me An Offer, and soon appeared in a number of West End shows including Gigi and Not Now, Darling.
She made her television debut in a 1961 episode of Emergency – Ward 10. Her other early roles were in Dixon of Dock Green, The Wednesday Play, Softly, Softly and Z-Cars. After playing a mother in Please Sir! and the Siberian wife in Mel Brooks's film The Twelve Chairs (1970), she was cast as Jean Abbott, the long-suffering wife of Sid James's character, in Bless This House, which began its run in February 1971. She reprised the role in the 1972 feature film and continued in the role until James died in 1976. She appeared in a few other films including The Millionairess (1960), The Family Way (1966), Charlie Bubbles (1967), Spring and Port Wine (1970), The Rise and Rise of Michael Rimmer (1970), The Best Pair of Legs in the Business (1972) and Operation Daybreak (1975).
During the late 1970s and 1980s, Coupland appeared in Wilde Alliance, Triangle, Dickens of London and Juliet Bravo. She was cast in soap opera Triangle after the original actor due to play the owner of the line died. She had been on the set with her husband, a director on the programme, and was offered the part. In 1992, she appeared in a 1992 episode of One Foot in the Grave, and in 2000 she had a six-week role as Maureen Carter in EastEnders. Following this, Coupland appeared in Doctors, Casualty and in 2005 Rose and Maloney, her final television appearance.
Diana Coupland married twice. She and her first husband, composer Monty Norman, divorced after 20 years of marriage, having had one daughter. In 2001, she gave evidence in a High Court case after her former husband sued The Sunday Times following a 1997 article suggesting that Norman had falsely taken credit and royalties for the James Bond theme music, which was claimed actually to have been written by John Barry. Coupland described the article as "blatantly untrue" and her former husband was awarded £30,000.
She married Marc Miller, a producer, in 1980. Coupland, who was a patron of National Lupus UK, died aged 78 at the University Hospital, Coventry in 2006 after failing to recover following an operation to resolve long-term heart problems.