She comes from a film-clan family of Bengali origin: Her father, Ram Mukherjee is a retired director. Her mother Krishna used to be a playback singer, while her brother Raja Mukherjee is a film producer. Her maternal aunt is Debashree Roy, a popular Bengali cinema actress. The popular Bollywood actress, Kajol, is her second cousin, along with Sharbani Mukherjee (Kajol's paternal cousin). Soon after graduating from Maneckjee Cooper High School in Juhu, she received a few film offers and moved to Mumbai to pursue a career in acting.
She began her film career with the Bengali film Biyer Phool. Her first Hindi film was Raja Ki Aayegi Baraat (1996), which did not do well at the box office. However, her next two releases - Ghulam and Kuch Kuch Hota Hai (1998) - were hits.[3] For the latter she received her first Filmfare Award in the Best Supporting Actress category.
Mukerji was in great demand after these successes and signed contracts to appear in many new films. Unfortunately, most of the resulting movies were only average to poor performers at the box office. Her career seemed to be stalled. Then the critical and commercial success of the 2002 film Saathiya again made her a hot commodity in the Bollywood marketplace.
Saathiya was only the first of a string of successful films. In 2004, her performances in Yuva and the commercially successful Hum Tum earned her more awards - the Filmfare Best Supporting Actress Award for the former, and the Filmfare Best Actress Award for the latter, the next year. Her performance as a Pakistani female activist lawyer in Veer-Zaara was also praised, and earned her many award nominations. In 2005, she starred in four high-profile films. Bunty Aur Babli and The Rising were among the biggest grossers of the year. Critics also commented favorably on her work, in particular her performance in Black. These successes established Mukerji as one of the industry's most bankable stars.