Sherwood was born in Montreal, Quebec, the granddaughter of the Dean of Dentistry at McGill University. She made her first stage appearance at age four in a church Passion Play. She started her professional career in Montreal when Rupert Kaplan cast her in CBC dramas and soap operas.[2]
Sherwood appeared in many soap operas over the years, most notably on Guiding Light as Mrs. Eilers and The Secret Storm as diner owner Carmen. She had cameos on All My Children as a bag lady and Another World as a befuddled matron, returning to Guiding Light briefly as Roxie Shayne's madame, Diamond Lil. She was featured in one of the last episodes of Capitol.[3][better source needed]. Sherwood also played Reverend Mother Placido in the comedy TV series The Flying Nun.
Sherwood was blacklisted during the McCarthy era.[4] Active in the civil rights movement, she worked with Martin Luther King Jr. in the late 1950s and 1960s and went south to join the Congress of Racial Equality (CORE). In May, 1963, she was arrested while participating in a Freedom Walk in Gadsden, Alabama, jailed, and sentenced to six months hard labor, for "[E]ndangering the Customs and Mores of the People of Alabama".[5]
During the 1980s, she received a grant from the American Film Institute as one of the first women to direct short films for that organization (along with Cicely Tyson, Joanne Woodward, and others). She wrote, directed and acted in her film, Good Night, Sweet Prince, which received excellent notices.[6]