Shefali Shah (née Shetty) was born in July 1972 and is the only child of Sudhakar Shetty (former RBI employee, and a Mangalorean) and Shobha Shetty (a homeopathy Doctor, from a Gujarati family). She spent her early childhood at the RBI quarters in Santa Cruz, Mumbai where she attended Arya Vidya Mandir, Santacruz, Mumbai. She speaks Tulu, Hindi, English, Marathi and Gujarati fluently.