Loe was born in Urmston, Lancashire, the daughter of Norman Scarborough Loe, who worked in equipment business, and a mother who was a department store worker and model. She attended Urmston Grammar School and the University of Birmingham, where she graduated with a BA degree in English and Drama. She then acted in repertory theatres in Crewe and Chester.
Loe was in the original British cast of the rock musical Hair. In 1970 she made her debut on British television and her first role was in the ITV Thames television programme Ace of Wands broadcast 1970–72 as Lillian 'Lillu' Palmer. Following this Loe made guest appearances on other shows such as Z-Cars, Dixon of Dock Green, Man at the Top, Armchair Theatre and ITV Playhouse.
In 1973 Loe was cast in the role of Alice Lee in a short-lived BBC Television programme Woodstock, which only lasted for a single 5 episode series. The same year she gave birth to actress Kate Beckinsale and in 1974 took time off acting to look after her then baby daughter. In 1975 after a couple months off, Loe appeared in the role of Princess May in the ATV drama series Edward the Seventh (1975).
Following this Loe began making guest appearances in sitcoms such as Ripping Yarns, Robin's Nest, The Upchat Line and Miss Jones and Son. In 1978 Loe appeared in an episode of the television drama Crown Court shortly before landing the role of Dr Helen Sanders in the final two series of the television drama General Hospital playing the role from 1978 until 1979.
In 1980 Loe appeared in one episode each of Heartland and The Gentle Touch before appearing in two episodes of Sunday Night Thriller and three episodes of When the Boat Comes In (1981). She also made a brief appearance as a nurse in Monty Python's The Meaning of Life (1983). Loe continued to make guest appearances in drama programmes up to 1985 shortly before landing the role of Diane in the television programme Yesterday's Dreams in 1987. In 1988 Loe gained the role of Pamela in the Yorkshire Television sitcom Singles with Roger Rees; this was the first sitcom which Loe had ever starred in and this lasted three series until 1991. In 1990 she took a regular role in The Chief, playing Dr Elizabeth Stafford from 1990 to 1993. In 1993 she played the love interest/suspect in Death is Now My Neighbour, an Inspector Morse episode.
In 1998 she played Commander Kathryn MacTiernan in Space Island One.
Between 2001 and 2002 she played Jan Goddard in Casualty and its spin off Holby City from 2002 to 2003. In 2009 Loe appeared in the medical drama Doctors.
According to the film makers commentary for Underworld: Awakening, Judy Loe, mother of Kate Beckinsale, (who portrays Selene), cameos as a Vampiress, a member of Thomas's Coven, who is shown briefly, after Thomas starts speaking in English, but before Olivia, the Coven's doctor arrives.
Judy Loe has married twice: first to Richard Beckinsale, from 1977 until his death in 1979; and second to TV director Roy Battersby, since 6 March 1997.