Born in Kingston, New York and raised in Ohio, O'Leary joined the Sisters of the Holy Humility convent in 1966, just out of high school, to "have an impact on the world." After graduating from Cleveland State University with a psychology degree, she left the convent in 1970 and would later write about her experience in a 1984 anthology, Lesbian Nuns: Breaking Silence. She moved to New York and did doctoral work at Yeshiva University.
At the time, she became involved with the nascent gay rights movement, joining the Gay Activists' Alliance (GAA) and lobbying state politicians. In 1972, she left the male-dominated GAA and founded Lesbian Feminist Liberation, one of the first lesbian activist groups in the women's movement. Two years later, she joined the National Gay Task Force, negotiating gender parity in its executive with director Bruce Voeller and joining as co-executive director.
In 1977 she organized the first meeting of gay rights activists in the White House, and was the first openly gay person appointed to a presidential commission, the National Commission on the Observance of International Women's Year, by Jimmy Carter. In this role she negotiated for gay and lesbian rights to be included on the discussion in a conference marking the year in Houston, Texas.
She was the first openly lesbian delegate to a national political convention, attending the Democratic convention in 1976, and served on the Democratic National Committee for 12 years, 8 of those on the Executive Committee, another first.
During the early 1980s she focused on building National Gay Rights Advocates, then one of the largest national gay and lesbian rights groups. It was one of the first to respond to the HIV/AIDS epidemic's implications for legal and civil liberties, using aggressive litigation to ensure AIDS patients' access to treatment.
She died in San Clemente, California of lung cancer, aged 57. She was survived by her partner Lisa Phelps, their daughter Victoria, their son David de Maria, his life partner James Springer, and David and James' son Aiden de Maria.