She was born in Dutton, Ontario.
She worked as a social worker in Toronto, Ontario and in Ghana. In 1979, McLaughlin moved to the Yukon and set up a consultancy business. In 1987 she ran in a by-election and won, the first NDP candidate to win in the north. In 1988 she was appointed caucus chair and in 1989 she was elected leader of the party, replacing the outgoing Ed Broadbent.
McLaughlin had taken over the NDP at its height but for many reasons, mostly outside of her control the party began a steady decline in the polls and in the 1993 election the NDP lost badly and was left with only nine seats in parliament. McLaughlin won her seat in the Yukon but resigned as leader in 1994 and was replaced by Alexa McDonough.
In August 2003 she was made an Officer of the Order of Canada.