Elizabeth J. Magie was born in Macomb, Illinois, to James Magie, a newspaper publisher and abolitionist who traveled with Abraham Lincoln during his senatorial campaign, and his wife. Her father's progressive political views and exposure to economic theories, particularly those of Henry George, deeply influenced her later work.

During this period, Lizzie Magie worked various jobs, including as a stenographer and writer. This provided her with financial independence and allowed her to explore her intellectual interests. She was known for her wit, intelligence, and strong convictions, often expressing her views on women's rights and economic inequality.

Driven by her desire to popularize Henry George's theories on land monopoly, Magie developed The Landlord's Game. The game simulated the real-estate market, demonstrating how land ownership could concentrate wealth and create poverty. She obtained a patent for the game in 1904, showcasing her ingenuity and her belief in the importance of economic justice.

Magie's initial version of the game was published by the Economic Game Company. While it garnered some attention, its complex rules and underlying political message limited its commercial success. However, it began to circulate through academic and leftist circles, becoming a popular teaching tool.

Lizzie Magie married Albert Phillips, continuing her work and advocacy. Phillips was a supporter of her ideas and likely aided in the promotion of her game.

As versions of her game, particularly one known as 'Monopoly,' gained popularity, Magie attempted to reclaim control and recognition for her creation. She secured a second patent for a revised version of The Landlord's Game, hoping to demonstrate her original authorship and protect her intellectual property. This version included simplified rules and reflected changes inspired by local versions of the game that had evolved organically.

During the Great Depression, with the widespread popularity of Monopoly, Parker Brothers purchased Magie's existing patent for The Landlord's Game for a mere $500. They also agreed to publish a limited run of her version alongside their more streamlined adaptation. However, Parker Brothers focused almost exclusively on Monopoly, marginalizing Magie's game and downplaying her role as the original inventor.

Lizzie Magie Phillips died in relative obscurity in Arlington, Virginia. She never received substantial financial compensation or widespread recognition for her invention, despite the enormous success of Monopoly, which was derived from her original design. Her contribution was largely forgotten until the late 20th and early 21st centuries when historians and game scholars began to uncover her story and acknowledge her significant role in the history of board games.