The youngest child of Stephen and Beth Logan, teenaged Katie felt as if she were in the shadow of older sisters Brooke and Donna, which, along with a bad case of acne, made her feel insecure. Donna talked her friend, Rocco Carner, into asking Katie out to boost her morale. Katie considered Rocco her boyfriend and couldn't see that Rocco was more interested in Donna. Katie was furious when she caught Donna and Rocco kissing. Katie forgave them, but Rocco wanted to marry Donna, and put an engagement ring in Katie's coat pocket, thinking the coat was Donna's. Katie found the ring and assumed it was for her. Rocco struggled with how to let Katie down easy. Once he did, Katie was hurt, but soon able to move on with Kurt, a college classmate.
Katie and Donna were thrilled when they received an "anonymous" tip that Stephen, who had walked out on the Logans years before, was in Arizona. (It was really a hint dropped by Stephanie Forrester, who wanted Stephen to lure Beth away from Stephanie's husband, Eric.) Stephen and Beth indeed reconciled, then moved to Paris. Afterwards, Katie faded into the background for years, but could occasionally be seen working at the Insomnia Café, or when Brooke needed a babysitter.
In 2007, Katie arrived for Donna's wedding to Thorne Forrester. But Katie overheard Donna admitting that she was only marrying Thorne as a way of getting back at Stephanie for hurting Brooke. Donna ignored Katie's pleas to be honest with Thorne, so Katie went to Thorne herself, and the wedding was called off. Katie had become skilled in public relations while she was away, so when Forrester Creations offered her a PR position, Katie decided to stay in Los Angeles.
Katie's brother, Storm, shot Stephanie and framed Stephen for the crime. When it was discovered that Storm pulled the trigger, Katie convinced Stephanie not to press charges. But Storm was on a downward spiral, and took a gun to the home of Ashley Abbott, who had broken up with him. Katie followed him there, and Storm's gun went off in the struggle. Katie was critically wounded and not expected to live. A remorseful Storm, who knew Katie needed a heart transplant, took his own life in order to donate his heart to her. Katie was devastated, although grateful for her brother's ultimate sacrifice.
When Katie's body rejected Storm's heart, Katie's doctor niece, Bridget Forrester, researched ways to help Katie accept the transplant. But the prognosis was grim, so Bridget convinced her family, and fiancé Nick Marone, to make Katie's last days special. This included giving Katie the high school prom she never had, and sending her to Catalina Island, where Katie fell for Nick. Bridget came through with a therapy for Katie, who recovered. Nick and Bridget got married, and Katie hid her feelings, even officiating at their wedding. A few weeks later, Katie discovered she was pregnant. It was revealed that Nick had honored Katie's dying wish on Catalina and made love to her. Bridget left Nick and Katie to have their baby together, though Nick's mother, Jackie Marone, disapproved. Soon after, Katie miscarried. She briefly dealt with it by fixating on Nick's son, Jack, but bounced back when Nick proposed.
On Katie's wedding day, Jackie and Bridget blasted Katie for her betrayal. Katie regretted destroying Bridget's marriage, and postponed the wedding. Katie noticed that Nick was still drawn to Bridget, who had left medicine and was designing with Nick. Katie moved out and got drunk at the Café Russe, where she met Bill Spencer, Jr., a womanizer who wanted to take over the financially struggling Forrester Creations. Bill chose not to take advantage of Katie in her impaired state. Katie added modeling to her résumé at Forrester, and started seeing Bill, who told her she got past his armor like no woman had. Katie questioned Bill's reasons for seeing her when she found a DVD left by his late father, Bill Spencer, Sr., which instructed Bill to get back at Eric, Stephanie, and Donna. Bill declared his love and recognized that Katie wanted to do something important, given her second chance at life. He finally acquired Forrester Creations, made Katie its CEO, and proposed to her. Katie joyfully married Bill in her old San Fernando Valley neighborhood, with Stephen and Beth at her side.
At Forrester, Katie put Donna and Brooke in leadership positions when the Forrester men refused them, and struggled to keep the peace between the Logans and the Forresters, who tried to sabotage the company with an ugly fashion line. Meanwhile, Bill's wandering eye turned to young Steffy Forrester, who had kissed Bill before his wedding. Katie never knew that the reason Bill put the company back in Forrester hands was because Steffy had gotten a hold of Katie's engagement ring in Bill's bedroom and used it to blackmail him. Later, when Bill discovered that Liam Cooper was his son, Katie encouraged a father-son relationship between the two.
Katie discovered another side to Bill when he plotted to kill Amber Moore, who claimed Liam was her baby's father. Detesting violence because of what happened with Storm, Katie walked out and refused to return until Bill agreed to therapy. Bill reluctantly sat through sessions with Katie and Dr. Taylor Hayes. Later, it appeared that Katie and Bill had worked their differences out off-screen. When Steffy's brother, Thomas Forrester, was missing at sea, a desperate Steffy turned to Bill for help. After Thomas was found, Bill and Steffy declared their love. Katie's surprise vow renewal ceremony inadvertently thwarted Bill's plan to tell Katie he was leaving. Taylor, appalled that her daughter Steffy wanted to be with Bill, told Katie about the affair. Katie had a heart attack while confronting Bill. In the hospital, Katie demanded that Bill choose between her and Steffy. Bill chose Katie, but became more involved in helping Steffy, who had fallen in love with Liam.
Katie was enraged when Bill gave Steffy a seat on the Spencer board, and, refused to travel with Steffy when Bill arranged a "family vacation" to Cabo San Lucas, where Steffy was injured in an ATV accident. Katie, knowing that Liam wanted to leave Steffy, was suspicious when Steffy's MRI stated she had a blood clot that would become life-threatening under stress. Katie's investigation revealed that Bill had faked Steffy's MRI. Bill confirmed he had continually helped Steffy to keep Liam from his first love, Katie's niece Hope Logan. Bill locked Katie in a tower to prevent her from telling Liam, but she escaped, and turned her back on Bill after exposing him.
Again, Katie and Bill seemed to resolve their issues off-screen, resuming a happy marriage until Katie announced she was pregnant. Bill demanded she get an abortion. When Katie refused, Bill broke down and admitted he was afraid that she would die trying to have a baby given her heart condition. Katie insisted it was worth the risk. Months later, Katie discovered Hope's father, Deacon Sharpe, in Bill's office and went into premature labor upon finding out Bill had bribed a warden and sprung Deacon from jail to prevent Hope's wedding to Liam. Katie gave birth to baby Will, then flatlined after a heart attack. During her near-death experience, Katie saw Storm, who helped her return to the living.
Afraid her weak heart would make Will an orphan, Katie slid into postpartum depression and ran away, viewing Brooke as a replacement for her in Bill's life; she led Brooke and Bill on a wild goose chase in Aspen, hoping to get them together. With the help of Donna and Taylor, Katie snapped out of her depression, ready to reclaim her place as Bill's wife. But Katie was unsettled when Taylor revealed that Bill and Brooke had kissed in Aspen. Katie forgave them, but became concerned about Bill's drinking, even staging an intervention. Relations between Katie and Bill became increasingly strained, and when Taylor reported that Bill had encouraged Brooke to relaunch her sexy lingerie line, Katie stormed their boozy celebration, furious that her husband and sister had become so close.
Later, Katie found Bill in Brooke's bed after a drunk-driving accident they had kept from her. Katie took off her wedding ring and walked out, then went into heart failure and fell into a coma after neglecting to take her anti-rejection medication. When Katie woke up, she took Bill back, and found herself in the unusual role of confidant to Steffy, who had miscarried Liam's baby. Katie took Steffy to the hospital when she collapsed, and learned that Steffy had been rendered infertile. Steffy swore Katie to secrecy, but, after Steffy moved to Paris, Katie told Brooke why Steffy had pushed Liam away.
After Brooke fainted and brushed it off as stress, Katie threw Brooke a birthday party to cheer her up. But Katie was horrified when Taylor arrived with proof that Bill and Brooke had slept together, and that Brooke had miscarried Bill's baby! Though Bill and Brooke blamed Katie for pushing them together, Katie threw Bill out and disowned Brooke. Katie filed for divorce, asking for 1% of Spencer Publications. Bill granted it, but Katie added it to Karen's 50%; now the majority stockholder, Karen made Katie CEO and fired Bill! Brooke slapped Katie during their resulting argument, although later Katie warmed up to Brooke by asking her to babysit Will. Katie set up hidden cameras to monitor Brooke and Bill, who had a few charged moments, but didn't cross the line. When Bill found out he was being spied on, he moved in with Brooke.
Katie gave Bill very little access to Will, until Bill nearly fell to his death while mountain climbing in Aspen. Bill begged for a reconciliation, and Katie signed papers that returned control of Spencer Publications to Bill, plus joint custody of Will. Smelling a rat, Katie found Bill at Brooke's, bragging how he had tricked Katie; Katie was more surprised when Brooke replaced Bill's papers with a pile of leaves and agreed to stay away from him.
Brooke's on-again-off-again true love, Ridge Forrester, came home to reunite with her after living in Paris for a year. But when Ridge found out how Brooke's relationship with Bill had hurt Katie, Ridge approached Katie with an understanding ear. As they spent time together, Katie began falling for Ridge, who had hesitantly agreed to marry Brooke; Katie fainted at the wedding on purpose to put a stop to it. Brooke laughed at the thought of Ridge ever wanting to be with Katie, but Ridge confirmed it, and Donna warned that Ridge's connection to Brooke might be too much for Katie to overcome.
Katie was incredulous when Eric made Ridge and Brooke co-vice presidents of Forrester in attempt to push them together. Katie took another hit as Spencer Publications seemed to falter under her leadership, and when Brooke, who had reunited with Bill, produced the papers Bill tricked Katie into signing to force Katie to reinstate Bill as CEO. But Katie was thrilled when Ridge announced he wanted to marry her. Katie tried to assure Ridge that Bill wouldn't be a bad influence on his son, R.J., but Ridge couldn't be convinced. After Ridge followed Brooke to Abu Dhabi to stop her wedding to Bill, Katie was horrified when Brooke called to report that Ridge had fallen out a helicopter into the Persian Gulf, and had gone missing. Katie traveled to the Middle East with Eric and Thorne to aid in the search; some time later, Brooke spotted Ridge wandering on the beach. Katie was overjoyed and took Ridge home for a big welcome home party, but Ridge had suffered a concussion and was having trouble with his memory. Katie was relieved when Ridge appeared to remember her and affirmed his intention to marry her.
Katie was supportive as Ridge struggled to regain his memory, and when Ridge insisted that Bill was responsible for his accident. Katie listened as Bill blew off Ridge's accusations; wanting to find out once and for all if Bill was involved, Katie teamed up with Deacon Sharpe, who had returned to town, in an attempt to scour Spencer Publications for information. Together, Katie and Deacon discovered that Bill's helicopter had been in Abu Dhabi the day of Brooke's wedding, and Ridge used the information to extract a confession from Bill, which ruined Bill and Brooke's attempt at reconciliation. But when Ridge continued being unable to design, Katie told Ridge to tell Brooke how Bill had cost him his livelihood.
Katie became concerned when Forrester model Maya Avant told her that Ridge was spending a lot of time working with Caroline Spencer. Katie tried to take things in stride when Ridge revealed he was able to “draw” by guiding Caroline's hand; when Eric looked to step down as CEO and name a successor, Katie was uncomfortable to hear that Caroline had developed a crush on Ridge, and that Ridge felt he could use it to secure the company's top spot. Soon, Katie learned that Ridge and Caroline had kissed, and decided to take a trip to Dallas to visit her father.
Once bitterly estranged, exes Katie and Bill began enjoying an easy friendship, further cemented when Bill saved their son from choking on a coin. Katie comforted Bill when Brooke, who saw an opportunity for Bill and Katie to reunite, took a job at Forrester's office in Milan to give them a chance to explore their options. Katie innocently told Bill how Ridge had kissed Caroline, but, when Bill stormed off to confront Ridge, Katie smiled to Will that “Daddy would take care of it.” Seeing Ridge bruised from Bill's beating, Katie told her fiancé that she wanted all of him, and Ridge agreed, asking Katie not to throw him away.
Katie spent even more time with Bill, bonding with him after Hope miscarried his grandson. Katie was moved when Bill pulled her into a kiss; later, unable to get past the intense connection Ridge had developed with Caroline, Katie took Ridge aside and called off their engagement. Katie was shocked when Bill apologized for taking her for granted and told her he wanted her back.