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Marshall was born in The Bronx borough of New York City. She was married to actor and director Rob Reiner from 1971 until 1979 - a period that coincided with the heyday of both of their television sitcom careers (Reiner acted in the role of Mike Stivic in the most-watched American sitcom during the first half of the 1970s, All in the Family).
Penny Marshall is the brother of producer, director, and writer Garry Marshall.