Born as Ashley Nicolle, Simpson's parents are Tina and Joe Simpson. She has one older sister, Jessica Simpson. Both she and Jessica attended Prairie Creek Elementary and North Junior High, located in Richardson, Texas, where the girls were raised. When she was three years old, she began studying classical ballet. She enrolled at the School of American Ballet in New York City when she was eleven, becoming the youngest person ever to be admitted into the school. Though the age requirement for the school was twelve, Simpson's father admitted to lying about her age. During this time, Simpson suffered from an unnamed eating disorder for about six months, eventually receiving treatment from her parents. The Simpson family relocated to Los Angeles, California, in 1999, as Jessica pursued a singing career. While Jessica launched her career, Ashlee began appearing in television commercials. Her father, Joe, served as her agent.
Following the commercial success of Jessica's debut album Sweet Kisses (1999), Ashlee became one of her back-up dancers on tour. Hoping to pursue a career in acting, Simpson had a minor guest appearance on an episode of Malcolm in the Middle. The following year, Simpson had a small role as Monique in the Rob Schneider comedy film The Hot Chick (2002). She joined the seventh season of the family drama 7th Heaven as Cecilia Smith, a role which she continued to portray in the eighth season. Simpson appeared in a total of forty episodes as Cecilia. That same year, Ashlee recorded a song titled "Christmas Past, Present, and Future" for the holiday album School's Out! Christmas; the song was later re-released on Radio Disney Jingle Jams following Simpson's musical breakthrough. She later recorded the song "Just Let Me Cry" for the soundtrack to the film Freaky Friday (2003). Simpson later began writing and recording demos, in hopes of finding a record label. It was confirmed a month after the release of the Freaky Friday soundtrack that Simpson had signed with Geffen Records to release her debut studio album.