Payal was born in Banjara Hills, Hyderabad, India on November 9, 1978. She was born to Veena Rohatgi and Shashank Rohatgi. She has a brother called Gaurav Rohatgi. She grew up in Ahmedabad. Her schooling was from Udgam School and she finished her engineering from L.D. College of Engineering, Ahmedabad. She participated in the Femina Miss India contest (2002) and was influenced to join the entertainment industry.
She gained popularity through a reality show Big Boss on Colors and also won Miss Tourism World in 2002 in Medellin, South America .