Learned was born in Washington, D.C., the eldest daughter of Elizabeth Duane "Betti" (née Hooper) and Bruce Learned, a diplomat. Her maternal grandfather was an attaché for the United States Embassy in Rome. She has five younger sisters: Gretl, Susan, Sabra, Dorit and Philippa.
She lived on a Connecticut farm for the first 10 years of her life. Learned said that her parents never explained why she received a masculine first name, once saying of her father: "All he told me was that if I had been a boy, I would have been named Caleb, but I was a girl, so I was called Michael."
When she was 11, Learned moved to Austria, where her father worked for the U.S. State Department. At this time, she attended Arts Educational School, Tring, now Tring Park School for the Performing Arts in Tring, Hertfordshire, England. During this time, she discovered the theater and decided to make acting her life's work.

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