Stevens, born Gloria Wood, was born in Los Angeles, California, the daughter of film producer and director Sam Wood. She made her first film appearance when she was just two years old in her father's second silent film, Peck's Bad Boy.

As an adult, she changed her name to K. T. Stevens to distance herself from her father's fame. She initially called herself Katherine Stevens, which people often shorted to "Katie," leading to the final version with the initials "K.T."