Banai was born in Beersheba and raised in Omer. Her father was a judge in Beersheba, and her mother was an education executive for the City of Beersheba. Many of her relatives are successful Israeli actors and singers. The next generation of the Banai family, including Orna and her brothers, Meir and Eviatar, followed this tradition. After three years of studying acting in Nissan Nativ's studio in Tel Aviv, Banai started performing in stand-up comedy and entertainment shows.
Banai became known for her portraying "Limor" in the humorous Israeli television shows Action and Rak BeIsrael (with Erez Tal). Since 2003, Banai has appeared in the popular satirical television show Eretz Nehederet. In addition, Banai acted in television dramas like Merchav-Yarkon and Max VeMoris. Banai also appeared in theatrical plays like Singles and The Last Striptease.
She served as a member of the Tel Aviv-Jaffa City Council on behalf of the Green Party from 2003 to 2008.
Banai is lesbian. She describes her views on the Arab–Israeli conflict as left-wing.