Ade was born in Karlsruhe, West Germany. As a teenager, Ade directed her first short films.
In 1998, she began studying film production and media management, and later film direction at the University of Television and Film (HFF) in Munich, which she successfully completed in 2004.
In 2001, Ade co-founded the film production company Komplizen Film together with Janine Jackowski, a fellow graduate from HFF. It was with Komplizen Film that she produced her final student film The Forest for the Trees at HFF in 2003. Among other honors, the film received the Special Jury Award at the Sundance Film Festival in 2005. The Forest for the Trees was screened at a large number of international festivals.
In 2012, Ade announced she would be writing and directing a film called Toni Erdmann about a man who begins to play pranks on his adult daughter after he finds she has become too serious. The film debuted In Competition at the 2016 Cannes Film Festival, the first German film to debut there in 10 years. The film won the top prize at the European Film Awards (Best European Film), thus making Ade the first woman to direct a movie that won the top prize at those awards.
Ade lives with director Ulrich Köhler and their two children in Berlin.