Melroy was commissioned in the United States Air Force and served as a KC-10 copilot, aircraft commander, and instructor pilot. Melroy is a veteran of Operation Just Cause and Operation Desert Shield/Desert Storm, with over 200 combat and combat support hours. She attended the Air Force Test Pilot School at Edwards Air Force Base, California. She was assigned to the C-17 initial test team as a test pilot until her selection for the Astronaut Program. She has logged more than 6,000 hours flight time in more than 50 different aircraft.

Melroy was selected as an astronaut candidate by NASA in March 1995. She flew three missions in space: as Space Shuttle pilot during STS-92 in 2000 and STS-112 in 2002, and as Space Shuttle Commander during STS-120 in 2007. All three missions were assembly missions to build the International Space Station. She has logged more than 38 days in space and was one of only two women to command the Space Shuttle. She was inducted into the Astronaut Hall of Fame in 2021.

Colonel Melroy retired from the Air Force in 2007, and left NASA in August 2009. After NASA, she served in executive roles at Lockheed Martin, the Federal Aviation Administration, DARPA, Nova Systems Pty, and on multiple boards. In 2021 she was appointed by President Biden as the Deputy Administrator of NASA, serving until January 2025. She now serves as President and Managing Partner for MH Technology Partners, a consulting firm.

Melroy is a Fellow of the American Institute of Aeronautics and Astronautics, the Society of Experimental Test Pilots, and the Royal Aeronautical Society. She is a Member of the US National Academy of Engineering.

Melroy is a popular speaker on topics such as the state of the space industry and future of space, and leadership, strategy and change management.