Baxter grew up in Plymouth, Massachusetts. The niece of Max ("Jethro Bodine") Baer Jr. immigrated to Hollywood at age 17 to live in Baer's mansion and her uncle promptly set up her up with James Woods, who she dated for several months. Despite being in California, Amy Lynn actually began her acting career in Florida where she picked up roles in T&A beach comedies like Summer's Games (1987), Summer Job (1989) and Lauderdale (1989) and in the Italian production Karate Warrior 2 (1988); all of which were filmed in and around Daytona Beach and Miami. Afterward, Baxter appeared in a nude pictorial in Penthouse magazine, becoming their "Pet of the Month" for June 1990. Other acting roles followed, mostly in softcore films directed by Ernest G. Sauer and shot in New York City.

Baxter is perhaps best known as a frequent fixture on Howard Stern's radio show and as the cover girl for his autobiography Private Parts. She appeared in Playboy's "Women of Radio" issue on behalf of the Stern show, which ended up severing her ties with competitor Penthouse. Amy Lynn has also appeared on talk shows like Geraldo, The Montel Williams Show and The Maury Povich Show.