She began her acting career in summer stock. In July 1931 Bretaigne Windust, Charles Leatherbee (the grandson of Charles Richard Crane), and Joshua Logan, the three Directors of the University Players, a three-year-old summer stock company at West Falmouth on Cape Cod, were looking for a leading lady for their repertory season that winter in Baltimore. At the suggestion of George Pierce Baker, they auditioned and hired O'Neil, one of his talented students at the Yale School of Drama. Romances born of the University Players led to three significant marriages: Actress Margaret Sullavan to Henry Fonda for a few months in 1932, director/actor Joshua Logan's younger sister Mary Lee Logan to Charles Leatherbee, and Joshua Logan himself to Barbara O'Neil, which lasted only a brief period in the early 1940s. O'Neil never remarried. She made her Broadway debut in a 1932 play about Carrie Nation. Her other stage credits include originating the role of Madam Serena Merle in a Broadway adaptation of The Portrait of a Lady in 1954.