Lawrence was born Vicki Ann Axelrad in Inglewood, California, the daughter of Anne Alene (née Loyd) and Howard Axelrad, a certified public accountant for Max Factor. Vicki's paternal grandfather, Simon Axelrad, was an Austrian Jewish immigrant, and Vicki's paternal grandmother, Anna Irmas, was born in Illinois, to German Jewish parents. Vicki's father was raised in Christian Science. Her mother was also Jewish. The family surname was legally changed to "Lawrence" when Vicki was young. She is a graduate of Morningside High School in Inglewood, class of 1967. Lawrence had originally planned on being a dental hygienist. She attended UCLA while on The Carol Burnett Show, and changed her major to theater arts, but dropped out after two years.
In high school, she auditioned for and got into the musical group The Young Americans. She stayed with the group almost until the end of high school. By being with the group, she gained experience from touring, performing at the Oscars, coming in contact with noteworthy performers such as Johnny Mathis and Louis Armstrong, and performing on The Andy Williams Show.
In her senior year, she entered the Miss Fireball of Inglewood contest for the local firefighter's ball. A reporter for a local newspaper wrote a story about the contest and stated that Lawrence bore a striking resemblance to a young Carol Burnett. An avid fan letter-writer, Lawrence's mother urged her to write a letter, which Lawrence did, including the newspaper article.
After receiving the letter, Burnett found Lawrence's father's name in the phone book, called him, and said she would go to see the Miss Fireball contest. Lawrence won the contest and Burnett was called to the stage to crown her. Coincidentally, Burnett was looking for an actress to play her younger sister on her upcoming show. After a few months and auditions, Lawrence got the part at age eighteen, specifically for playing Chrissy in the "Carol and Sis" sketches.
After Lawrence was given the job on The Carol Burnett Show, both Burnett and Harvey Korman took her under their wings. Korman taught her various sketch comedy skills, such as listening not just for a cue line, and also coached her in other areas, such as speaking in different accents. Lawrence has credited Korman and Burnett with being her mentors, and has referred to her experience on the show as the "Harvard school of comedy". Lawrence has stated that she learned show business from Burnett and looked up to her very much, and that the two share a very close friendship.