Alison Newman was born in Bournemouth, Hampshire, to David and Jenny Newman. She has one sister called Sarah. Both her parents were school teachers who encouraged her to take up acting as a hobby, but discouraged her from attending stage school when she was younger, a decision she subsequently agreed was probably sensible. Instead she joined the National Youth Theatre when she was 16. Her father died in October 2002, while she was filming the second series of Footballers' Wives. The producers allowed her to take time off from filming some of her last scenes in the series finale so she could be with her family.
In 2002, Newman was cast in the role of ruthless lesbian football agent, and later club chair, Hazel Bailey in Footballers Wives. Newman was allegedly awarded the role on the strength of a two-episode guest appearance in the series Bad Girls, in which she played Renee Williams who set out to secure revenge on nemesis Top Dog Yvonne Atkins (Linda Henry). Both programmes were made by Shed Productions. The part of Hazel Bailey required Newman to have her naturally blonde hair dyed red. Newman left the show at the end of series 4, when her character decided to return to sports representation, after becoming romantically involved with a professional tennis player.