Tanwar was born on 12 January 1973 to Rajendra Singh Tanwar, a retired CBI officer, in a middle-class family from Alwar, Rajasthan, India. She was educated in many Kendriya Vidyalayas before graduating from Lady Shri Ram College in New Delhi. Prior to this, in 1990, after completing her pre-university course, she worked as a sales trainee at a five-star hotel. In college, she was the secretary and president of the dramatic society. After graduation, while preparing for the entrance tests to the administrative services and mass communications, she gave an audition for the national broadcaster Doordarshan's film songs based program Albela Sur Mela in 1998; she was selected as the presenter.

After her television debut in 1998 with Albela Sur Mela, Tanwar gained fame for her role of Parvati Agarwal in the soap opera, Kahaani Ghar Ghar Kii. Between 2011 and 2014, she played Priya Kapoor, opposite Ram Kapoor, in Bade Achhe Lagte Hain.

In December 2012, she made an appearance in Kaun Banega Crorepati.

In the 2016 film Dangal, Tanwar played Daya Kaur, wife of former wrestler Mahavir Singh Phogat (played by Aamir Khan), who trains his daughters to be world-class wrestlers against social odds.

Fiction shows

• 2000–08 Kahaani Ghar Ghar Kii as Parvati Agarwal / Swati Dixit/ Janki Devi Dixit
• 2001-2002 Kutumb as Maya Mittal
• 2003 Devi as Gayatri
• 2004 Jassi Jaisi Koi Nahin as Indira Bhargav
• 2008 Bawandar (featured in one episode)
• 2008 Kahaani Hamaaray Mahaabhaarat Ki as Ganga
• 2010 Balika Vadhu as Teepri
• 2011–14 Bade Achhe Lagte Hain as Priya Kapoor
• 2013 Ek Thhi Naayika (episodes #13 and #14) as Pooja
• 2014 Main Naa Bhoolungi as Narrator in first episode
• 2016 24: Season 2 as Shivani Malik
• 2017 Karrle Tu Bhi Mohabbat as Tripurasundari (web series with Ram Kapoor)

Non-fiction/reality shows

• 1998 Albela Sur Mela as the host
• 2005 Kaun Banega Crorepati 2 as guest contestant (along with Smriti Irani to promote Kahaani Ghar Ghar Kii)
• 2009 Coffee House as herself
• 2010 Crime Patrol – Season 2 as the co-host cum narrator (along with Anup Soni)
• 2012 Kaun Banega Crorepati 6 as guest contestant (along with Ram Kapoor and Amrita Mukherjee to promote Bade Achhe Lagte Hain)
• 2013 Kaun Banega Crorepati 7 as guest contestant (along with Ram Kapoor to promote Bade Achhe Lagte Hain)
• 2015 Code Red as the host cum narrator
• 2017 Tyohar ki thali as the host cum narrator on Epic TV.

• In 2013, She was voted India Today's No.1 Television's most popular onscreen couple^[33]
• In April 2013, in a survey conducted by Ormax Media, Tanwar featured in Top 5 most trustworthy celebrities.^[4]