Dorfman was born in Argentina but his family moved to the United States shortly after his birth, returning to Chile in 1954. He attended and was later a professor at the University of Chile.
From 1970 to 1973, Dorfman was part of the administration of president Salvador Allende. He was forced into exile following the bloody military coup of 1973 in which General Augusto Pinochet came to power.
Since 1985 he has taught at Duke University.
Since the restoration (1990) of democracy in Chile, he divides his time between Santiago and the United States.
Dorfman has written fiction often dealing with the horrors of tyranny and, in later works, the trials of exile. He has also been one of Pinochet's most eloquent critics, and wrote extensively about his extradition case for the Spanish newspaper El País and other publications.
Probably his most famous play is Death and the Maiden, which was also made into a film by Roman Polanski.