Duigan studied at the University of Melbourne, where he resided at Ormond College and graduated in 1973 with a master's degree in Philosophy. While at university, he worked extensively as an actor and director in theatre, and acted in a number of short films.
Subsequent films included The Year My Voice Broke, for which he won AFIs for Best Director and Best Screenplay, and Flirting, both of which won Best Picture at the AFI Awards. Subsequently, Duigan worked in the United States and Europe, returning to Australia to make Sirens, winner of Best Film at the St. Petersburg Film Festival.
In the United States he directed Romero, starring Raul Julia, which won the Humanitas Award, and Lawn Dogs, winner of numerous prizes in European festivals. In England he directed The Leading Man, from a screenplay by his sister Virginia, The Parole Officer with Steve Coogan, and in Canada/France/UK Head in the Clouds with Charlize Theron and Penélope Cruz, winner in Canada of four Genie Awards and Best Film at the Milan International Film Festival.
Between 2005 and 2010 he took time off from the film industry to work on a book on secular ethics, returning to Australia to direct Careless Love in 2011/12.