She was born in Hamburg. Together with Heinz Kucharski, Lafrenz studied under Erna Stahl at the Lichtwark-Gymnasium, a liberal arts school in Hamburg. When coeducation was abolished in 1937, Lafrenz moved to a convent school, where she and classmate Margaretha Rothe graduated in Easter 1938. Together with Rothe, Lafrenz began to study medicine at the University of Hamburg in the summer semester of 1939. After the semester she worked in Pomerania, where she met Alexander Schmorell who had begun studying in the summer of 1939 at the Hamburg University's Medical School but continued his studies from 1939/40 in Munich.
In May 1941 Lafrenz moved to Munich to study there, where she got to know Hans Scholl and Christoph Probst. In her opposition to the Nazi regime, she found inspiration in the writings of Rudolf Steiner. She attended many talks and discussions of the White Rose group, including those with Kurt Huber. In late 1942 she brought the third White Rose flyer to Hamburg and redistributed them via her former classmate Heinz Kucharski. When on 18 February 1943 Hans and Sophie Scholl were arrested in Munich University, Traute Lafrenz also was put under investigation by the Gestapo. She was arrested shortly afterwards on 15 March, together with Alexander Schmorell and Kurt Huber and sentenced to one year in prison on 19 April 1943. During her interrogation by the Gestapo Lafrenz succeeded in disguising the full extent of her involvement in the leaflet distribution. After her release she was arrested again by the Gestapo and imprisoned again.
In 1947 she emigrated to the United States, completing her medical studies at Saint Joseph's Hospital in San Francisco, California. After moving to Chicago, she served from 1972 to 1994 as head of Esperanza School, a private, therapeutic day school serving students with developmental disabilities between the ages of 5 and 21. She has been involved in the anthroposophical movement in the United States for more than half a century. She is now retired and lives on Yonges Island near Meggett, South Carolina.