Reed has been a member of Chicago's Steppenwolf Theatre Company for many years, appearing in 51 productions with the company. She appeared on Broadway in The Rise and Fall of Little Voice in 1994 and The Grapes of Wrath in 1990, among others. On July 13, 2005, she originated the role of Madame Morrible in the Chicago production of the musical Wicked.

She originated the role of Mattie Fae Aiken in the Broadway production of August: Osage County in 2007, for which she won the 2008 Tony Award for Best Performance by a Featured Actress in a Play.