Dorothy Cawood was born at Parramatta, New South Wales, on 9 December 1884. She was the seventh child of John Cawood, a carpenter, and his English-born wife, Sarah. There are few details of her early education, but in 1909 at the age of 25, she began training as a nurse at Coast Hospital, at Little Bay in Sydney. After four years of training she was registered with the Australasian Trained Nurses' Association on 14 May 1913.
Cawood enlisted in the Australian Imperial Force on 14 November 1914 as a staff nurse in the Army Nursing Service and was posted to the 2nd Australian General Hospital (2AGH). She embarked on the Kyarra and sailed to Egypt. On arrival in Egypt, 2AGH was based at Mena and Ghezireh, on the outskirts of Cairo.
During the Gallipoli Campaign, Cawood mainly served at 2AGH, though on several occasions, she was seconded to transport ships brining wounded back to Egypt. In December 1915 she was promoted to nursing sister. With the Gallipoli campaign over, she went with 2AGH to France. After serving at Marseilles and Wimereux, near Boulogne, she spent a brief period on attachment to the 8th Stationary Hospital and the Australian Voluntary Hospital before returning to 2AGH in July 1916.
By December 1916 Sister Cawood's nursing duties brought her closer to the front and into more immediate danger. Nursing at the 2nd Australian Casualty Clearing Station at Armentières during July 1917 Sister Cawood along with Sisters Deacon, Ross King and Staff Nurse Derrer, risked their lives to rescue patients trapped in burning buildings after a German air raid. In September the four became the first members of the Australian Army Nursing Service to be awarded Military Medals.
On 1 August Sister Cawood was transferred to the 38th Stationary Hospital at Calais and, in November, to the 6th Australian General Hospital. While serving there she was mentioned in dispatches for "distinguished and gallant service in the field". Not long afterwards Sister Cawood was transferred to the Genoa, Italy, with the 38th Stationary Hospital. She was hospitalised with tonsillitis for a few months in 1918, but served in Genoa until January 1919. She was then transferred to England where she was attached to the 3rd Australian Auxiliary Hospital at Dartford and the 2nd Australian Auxiliary Hospital at Southall.
Sister Cawood returned to Sydney in May 1919 on board HT Soudan after more than four years overseas. After being demobilised she worked in the State Hospital at Liverpool, New South Wales, before becoming matron of the David Berry Hospital in Berry. She retired in 1943 and the following year returned to Parramatta where she lived until her death in 1962. She had never married and was buried in Sydney's Rookwood cemetery.