Penelope Beaton studied at Edinburgh College of Art, graduating in 1917 and the joining the staff in 1919. In the interval she taught at Hamilton Academy alongside Donald Moodie and D M Sutherland, both of whom had considerable influence on her work. Amongst her pupils at that time was Mary Armour whom she persuaded to follow a career in art. In later years at ECA her colleagues included Robin Philipson and William Gillies. She was one of a group of artists defined as the Edinburgh School.
Beaton was a painter in both oil and watercolour of still lifes, genre, harbour scenes and the island of Iona. During the 1930s her watercolour style was influenced by William Gillies' Expressionist style, but she moved towards a more constructed style during the 1940s. In later years her watercolours had a strong pen and ink framework, coloured with rich, sonorous tones.
She exhibited her work widely, including 102 works at the Royal Scottish Academy, the Glasgow Institute of Fine Art, Royal Scottish Society of painters in Watercolour, amongst others.
She was elected RSW in 1952 and ARSA 1957.