Karolina Eiriksdottir was born in Reykjavík. She studied at the Reykjavik College of Music, where Thorkell Sigurbjornsson was her teacher of composition. She continued her studies at the University of Michigan in Ann Arbor with George Wilson and William Albright as teachers of composition, and received masters degrees in composition and music history and musicology. Since 1979 she has been active in Iceland's music life as a composer and teacher at The Reykjavik College of Music. She was chairman of the board of The Iceland Music Information Centre 1983-1988, and on the board of The Society of Icelandic Composers during 1988-1991 and again from 1995-1998 and the Reykjavík Arts Festival from 1998 - 2006 and on the board of the Iceland Academy of the Arts from 1998 - 2011.

Karolina Eiriksdottir has received commissions in Iceland, the Scandinavian countries and elsewhere. Her works have been performed widely, including performances in Iceland, the Scandinavian countries, Paris, London, Glasgow, Vienna, Tokyo, the United States, Germany, Switzerland, Spain and Argentina.

Among her works are solo and chamber pieces, orchestral pieces, computer music and four operas the latest being Magnus Maria, premiered in Åland, July 2014. The opera Someone I have seen, was premiered in Vadstena in Sweden in 1988, and later performed in Reykjavik, London and Greifswald in Germany. Eiríksdottir has been one of featured composers at the Nordic Music festival in Göteborg and the Stockholm New Music festival. In 1995 a Clarinet Concerto was commissioned and premiered by the Aalborg Symphony Orchestra. Among recent works are Saxophone Quartet, commissioned by Nomus and the Stockholm Saxophone Quartet, the chamber opera Man Alive and Toccata for orchestra, which was performed at the Berlin Philharmonie Hall by the Nordic Orchestra at the inauguration of the Nordic Embassies in October 1999. In 2001 Eiriksdottir was composer in residence at the Skalholt Music Festival and her Guitar Concerto was premiered in Santa Fe in Argentina. In October 2005 there was a portrait concert with solo and chamber music of Eiriksdottir at the National Gallery of Iceland. The opera Shadow play was premiered in Reykjavík in November 2006 and Concerto for two flutes and Orchestra was premiered in Reykjavík January 2007. From 2008 to 2011 Karolina composed music to three video works with the visual arts duo Libia Castro and Olafur Olafsson and in 2012 a Concerto for oboe and chamber orchestra was premiered at the Dark Music Days festival in Iceland and in succession in Seinajoki in Finland.