Liz O'Donnell was elected to Dáil Eireann for the Progressive Democrats, representing Dublin South, in 1991. She was opposition spokesperson on Health and Social Welfare from 1992 to 1993, and Party Whip and Justice spokes-person from 1993 to 1997. In 1997 Liz O'Donnell was appointed Minister of State at the Department of Foreign Affairs with responsibility for Overseas Development Assistance and Human Rights.
Liz O'Donnell represented the Irish Government at the multi-party talks at Stormont, which culminated in the Good Friday Agreement in 1998. She was also a member of the Cabinet Sub-Committee on Asylum Immigration and related matters. Liz was re-elected to the 29th Dáil at the 2002 general election as TD for Dublin South.
In December 2002, Liz was awarded the Doolin Memorial Medal for her contribution to Overseas Development and Human Rights.