She was born Ana Teresa Parra Sanojo in Paris, the daughter of Rafael Parra Hernáiz, Venezuelan Ambassador in Berlin, and Isabel Sanojo de Parra.

As a member of a wealthy family, Ana Teresa spent part of her childhood at her father's hacienda, Tazón. After the death of her father, Ana Teresa and her sisters were taken by their mother to study at the Sacred Heart School, in Godella, Spain. Under fervent religious precepts, they received a solid education, suitable for upper class young ladies. Ana Teresa returned to Caracas at the age of 19.

After she settled in Paris, de la Parra travelled and had an intense social life. She began to research a biography of Simón Bolívar, perhaps inspired by the centenary of his death. However, her studies were interrupted when she was diagnosed with tuberculosis. Teresa de la Parra wandered in several European sanatoriums, mainly in Switzerland and Spain, but did not find a cure. She reflected about her philosophical and literary ideas, and studied her own work and life evolution through the years. The longest and most beautiful letters ever written to her family and friends, and her intimate diaries, come from this time and must be considered as part of her literature.

Teresa de la Parra died in Madrid. Her remains were exhumed and brought to Caracas in 1947.

She rebelled against the limited expectations for women of her class by long hours of reading and writing. Her fictional stories were published in the newspaper El Universal, and her Diary of a Caraqueña in the Far East was published in the magazine Actualidades. De la Parra's story Mama X earned first prize in a contest held in a provincial Venezuelan city. This story, as well as her Diary of a young lady who writes because she is bored (which was published in the magazine La Lectura Semanal) was the beginning of her first major work.

De la Parra's novel Iphigenia: Diary of a young lady who wrote because she was bored, published in 1924, marked a change in Venezuelan literature. Teresa de la Parra wrote most of the novel in 1921 and 1922 during the dictatorship of Juan Vicente Gómez. Some of the characters in the novel were maliciously close to caricatures of people who were then well known in Caracas society. The characters Abuelita, Tía Clara and César Leal represent strict adherence to morality. Ambitious and politically corrupt characters like Gabriel Olmedo and Tío Pancho also reflect moral freedom given to men, in contrast to the passive role assigned to women. The protagonist of Iphigenia, María Eugenia Alonso, a well educated and intelligent young woman, is partly a self-portrait of the author. María Eugenia struggles against being confined in a marriage that threatens to stifle her intellectual development. She strives to determine whether it is possible for an intelligent and educated woman to evade marriage without losing her respectability in a society where women are expected to become wives and mothers.

The tone, thematic nature and social - historic context of Iphigenia made it controversial among some social and literary circles in Venezuela and Colombia. Juan Vicente Gómez's government would not give Venezuelan publishers money to publish Iphigenia. Teresa de la Parra travelled to Paris, where she had friends such as Simón Barceló, Alberto Zérega Fombona, Ventura García Calderón and Gonzalo Zaldumbide.

Winner of the annual award given by Casa Editora Franco - Ibero - Americana in Paris in 1924, Teresa de la Parra finally had her work published and received a prize of 10,000 French francs. Iphigenia became a firm success among Parisian intellectuals and readers. It was soon translated into French. Two years after multiple trips and works — which included lectures in Nations Society and exquisite responses to critics — the writer began her second major work.

Souvenirs of Mama Blanca, published in 1929, was a nostalgia filled fictionalized memoir of De la Parra's childhood. The spirit of the four sisters living on the hacienda Tazón is reflected in the six sisters living on the hacienda Piedra Azul. The moral "correctness" of Souvenirs of Mama Blanca received favorable attention from those who had criticized Iphigenia. In her letters, de la Parra wrote that there was no Iphigenia scent in Souvenirs of Mama Blanca, which had no protest speech, revolutionary ideas or social criticism.

De la Parra became a sought after lecturer. Her more important speeches took place in Havana and Bogotá; the last one was very significant with regards to her personal ideas about women's roles in Latin American society from colonial times into the 20th century.