Born Ella Wallace Raubes near Snoqualmie Falls, Washington, Raines studied drama at the University of Washington and was appearing in a play there when she was seen by Howard Hawks. She became the first actor signed to the new production company he had formed with the actorCharles Boyer, "B-H Productions", and made her film debut in Corvette K-225 in 1943. Immediately following her role in that film, she was cast in the all female war film Cry 'Havoc', made the same year. In 1944 she starred in a series of big films including the film noir Phantom Lady, the comedy Hail the Conquering Hero, and the John Wayne western Tall in the Saddle. Soon, she began appearing in B-films including 1945's The Strange Affair of Uncle Harry with Geraldine Fitzgerald and George Sanders and the 1947 thriller The Web. With the exception of Brute Force, in which Raines appeared with Burt Lancaster, none of her later films were nearly as successful as her previous movies and her career began to decline.
Raines appeared on the cover of Life magazine twice, once in 1944 for her work in Phantom Lady and once in 1947 for Brute Force.
In 1954 and 1955 she starred in the television series Janet Dean, Registered Nurse. She also appeared in such television series as Robert Montgomery Presents, Douglas Fairbanks, Jr., Presents, Lights Out, Pulitzer Prize Playhouse and The Christophers.
She retired from acting in 1957, but made one further screen appearance with a guest role in the series Matt Houston in 1984.
Raines has two stars on the Hollywood Walk of Fame for her contribution to motion pictures at 7021 Hollywood Boulevard, and for television at 6600 Hollywood Boulevard.
Raines was married, secondly, in 1947 to United States Air Force fighter pilot Brigadier General Robin Olds; the couple had two children.
She died from throat cancer in Sherman Oaks, California in 1988, aged 67.