Peabody was born on January 11, 1948 in Portland, Oregon, though she grew up in Miami, Florida where she pursued acting at a very young age. In the mid 1960s, Peabody made her debut appearance in the educational film that delved into drug abuse called Misfits. The film was produced by a company in the New York area and she got the part after one of the actresses was unable to commit to filming after becoming sick with an ailment. In the early 1970s, she was mostly cast in low-budget drive-in films that were being shot in Florida such as The Horse Killer (1970), which Peabody stated, "It was actually based on the true story of a man who castrated horses! It was a really bizarre story, but it wasn't like Last House, with sex or murder. It was more of a mystery, where these incidents were happening and they were trying to find this weird guy who was doing it. I was playing the girlfriend, and we had a lot of scenes riding horses and that sort of thing.