Candy Dulfer was born in Amsterdam on September 19, 1969, the daughter of the tenor saxophonist Hans Dulfer. Born in 1940 and self-taught, her father formed a saxophone-and-organ funk quartet at the end of the 1960s and went on to record El Saxofón (1971) with Frank Wright and the drummer Muhammad Ali, and Maine (1977) with the trombonist Roswell Rudd. She started on drums at five, moved to soprano saxophone at six and settled on alto at seven. Her first recordings came at eleven, on I Didn't Ask (1981) by her father's band De Perikels. In 1982, at twelve, she played the North Sea Jazz Festival in the horn section of the American-born saxophonist and singer Rosa King, and heard David Sanborn live there for the first time. King encouraged her to lead her own group, and in 1984, at fourteen, she formed Funky Stuff.

Her breakthrough came through pop and funk rather than the jazz clubs. In 1987 Funky Stuff opened two of Madonna's European concerts. In 1988 Prince invited her onstage during a European show to take an improvised solo, and in 1989 she played with him on Saturday Night Live and appeared in his "Partyman" video, which, her own biography says, carried a tongue-in-cheek endorsement from Prince: "When I want sax, I call Candy." The same year the Eurythmics guitarist Dave Stewart asked her to play on an instrumental for the soundtrack of the Dutch film De Kassière, released abroad as Lily Was Here. The resulting single, "Lily Was Here," spent five weeks at number one in the Netherlands, reached number six in the United Kingdom and number 11 on the Billboard Hot 100.

Her debut album Saxuality (1990), produced with Ulco Bed, reached number four on Billboard's Contemporary Jazz Albums chart and number 22 on the Billboard 200, and earned a Grammy nomination. That year she also sat in with Pink Floyd at Knebworth, a performance later issued on video and in the band's The Later Years box set. Sax-a-Go-Go (1993) reached number five on the contemporary jazz chart and set her own originals beside covers of "Pick Up the Pieces," "Compared to What," "I Can't Make You Love Me" and Prince's "Sunday Afternoon," with the Tower of Power horn section on "2 Funky" and the JB Horns on "Jamming." Around her own records she became a sought-after guest, playing alto on Van Morrison's Hymns to the Silence (1991) and Too Long in Exile (1993), joining his band on A Night in San Francisco (1994), playing on Aretha Franklin's What You See Is What You Sweat (1991) and guesting on Maceo Parker's Life on Planet Groove (1992).

Big Girl (1995) brought in the producer and keyboardist Thomas Bank alongside Bed and pushed toward hip-hop, with a David Sanborn alto solo on "Wake Me When It's Over," a tune by Sanborn and Marcus Miller. For the Love of You (1997) reached number two on the contemporary jazz chart. What Does It Take (1999) was the first of her records to feature her own singing, and its band included the trombonist Fred Wesley, the saxophonist Pee Wee Ellis, the trumpeter Arturo Sandoval, the guitarist Jonathan Butler and Dave Stewart, with her father on tenor. Live in Amsterdam (2001) had Angie Stone as a guest singer, Dulfer & Dulfer (2002) paired her with her father, and Live at Montreux 2002 documented a festival set. She returned to Prince in the same years, playing on One Nite Alone... Live! (2002), Xpectation (2003) and 3121 (2006), appearing on Musicology (2004) and joining his band for the Musicology Live 2004ever tour alongside Maceo Parker.

Candy Store (2007) reached number two on Billboard's contemporary jazz chart, and "L.A. Citylights" went to number one on the Smooth Jazz National Airplay chart. The same year she hosted the Dutch television series Candy Meets..., interviewing Sheila E., Maceo Parker, her father, Van Morrison, Dave Stewart and Mavis Staples, and received a Gouden Harp in March. Funked Up! (2009) and Crazy (2011, produced with Printz Board and leaning toward dance music) both reached the top ten of the contemporary jazz chart. She was a judge on the fifth season of the Dutch X Factor in 2013, and sings and plays with the all-female Dutch group Ladies of Soul, with Trijntje Oosterhuis, Glennis Grace, Berget Lewis and Edsilia Rombley, whose concerts have filled the Amsterdam Ziggo Dome. Together followed on April 14, 2017, and in October 2017 a memoir, Sax, Candy & Rock-'n-Roll, written with Liddie Austin. In August 2017 she was made an honorary citizen of the Serbian city of Niš, for promoting the city through her appearances since her first Nisville Jazz Festival performance in 2009.

In 2021 she received the Edison Jazz Oeuvreprijs, the Dutch jazz prize for a body of work; earlier recipients include Herbie Hancock, Marcus Miller, Patti Austin and Al Jarreau. That year she also signed with Mascot Label Group and began a weekly radio show on Sublime FM. We Never Stop (October 28, 2022) added the Chic guitarist Nile Rodgers as a guest, and a documentary about her life by the director Carine Goeijers opened in Dutch cinemas the same year. According to her own biography she returned to festival and club stages in Europe, Japan and the United States in 2024, and a Hot Summer Funk Tour played Germany in July 2025. We Never Stop is her most recent studio album.

Dulfer plays alto saxophone with a tenor player's swagger, a habit AllMusic ties to her father's influence and to her early study of Sonny Rollins, Coleman Hawkins and Dexter Gordon. The altoists she later drew on include Earl Bostic, Cannonball Adderley, Maceo Parker and David Sanborn, and AllMusic adds Miles Davis to the list of influences. Her records lean on the riff-driven phrasing of funk and soul saxophone and on the melodic alto style of smooth jazz.

The pop, funk and smooth-jazz side is the larger part of her output and is stated here plainly: her biggest hit, "Lily Was Here," is an instrumental pop single, her records are produced for contemporary-jazz and smooth-jazz radio, and they move through R&B, hip-hop and dance music without much concern for jazz tradition. Her jazz-side credentials are documented and specific. She played the North Sea Jazz Festival at twelve, comes from a family of jazz improvisers, recorded a duo album with her father, has a live Montreux Jazz Festival release, charts regularly in Billboard's jazz and contemporary jazz lists, was nominated for a Grammy for her debut album, headlines jazz cruises in the United States and Europe, and received the Dutch Edison Jazz Oeuvreprijs in 2021. She is best read as a funk and crossover saxophonist with real jazz roots rather than as a straight-ahead improviser.