Karen Sheila Gillan was born and raised in Inverness, Scotland, as the only child of Marie Paterson and husband John Gillan, who is a singer and recording artist. She developed a love for acting very early on, attending several youth theatre groups and taking part in a wide range of productions at her school, Charleston Academy.

At age 16, Karen decided she wanted to pursue her acting career further and, studied under the renowned theatre director Scott Johnston at the Performing Arts Studio Scotland. She later attended the prestigious Italia Conti Academy in London.