Carol Spencer began her career in 1955, winning the Guest Fashion Editor position with Mademoiselle Magazine. In 1963, she saw an ad in the California Apparel News for a Fashion Designer for Mattel. She was invited to the company headquarters for an interview, asked to make a suite of outfits for the doll, and ultimately got the job. Her designs include Great Shape Barbie in the movie Toy Story and the company's best-selling Totally Hair Barbie, which was reproduced in 2017, with roughly $100 million in sales and over 10 million units sold worldwide in its debut year of 1992.

In 1999, she was inducted into the National Toy Hall of Fame at the Strong Museum of Play in Rochester, NY, in the inaugural year of the "Women In Toys Emeritus Program." A OOAK doll was made for Spencer to commemorate her retirement from Mattel at the end of that year.