Marjory Douglas was born on April 7, 1890 in Minneapolis, Minnesota, United States, into the family of Frank B. and Lillian (Trefethen) Stoneman. After her parents' divorce (when she was 6), she moved to her mother's home in Taunton, Massachusetts.
Her mother, whom Marjory characterized as "high-strung", was committed to a mental sanitarium in Providence several times. Her parents' separation and the contentiousness of her mother's family caused her to suffer from night terrors. She credited her tenuous upbringing with making her "a skeptic and a dissenter" for the rest of her life.