In 1985, she auditioned for Mbongeni Ngema’s musical, which later became the international blockbuster Sarafina!, Ngema wrote the lead character of Sarafina especially for Khumalo. She is currently married to Mbongeni Ngema. But there have been recent speculations that he has had several affairs with different women, including the late Brenda Fassie.
Khumalo performed the role of Sarafina! on stages in South Africa and on Broadway, where she received a 1988 Tony Award nomination for Best Actress in a Musical. Sarafina! had a Broadway run lasting two years, after which the production embarked on a world-wide tour. In 1987 Khumalo received a NAACP Image Award for Best Stage Actress.
In 1992, she starred alongside Whoopi Goldberg, Miriam Makeba and John Kani in Darrell James Roodt’s film version of Sarafina!, which had a world-wide distribution, and became the biggest film production to be released on the African continent. Again Khumalo was nominated for an Image Award, together with Angela Bassett, Whoopi Goldberg and Janet Jackson.
Based on the 1976 Soweto youth uprisings, Sarafina! tells the story of a young school girl who is not afraid to fight for her rights and inspires her peers to rise up in protest, especially after her inspirational teacher, Mary Masembuko (Goldberg) is imprisoned.
In 1993, Khumalo released her first album, Leleti and Sarafina.
Sarafina! was re-released in South Africa on 16 June 2006 to commemorate the 30th anniversary of the youth uprisings in Soweto. The re-mastered director’s cut is not much different from the original.
She also co-starred in Mbongeni Ngema’s international musical Magic at 4 AM which was dedicated to Muhammad Ali. She subsequently starred in another Ngema musical Mama (1996), which toured Europe and Australia. In 1997, she also starred in Sarafina 2.
Khumalo stars in 2004 movies Hotel Rwanda and Yesterday, of which the latter has been nominated for a 2005 Academy Award in the category "Best Foreign Language Film". Yesterday also recently scooped the Best Film award at India's Pune International Film Festival and had fantastic reactions at the Venice and Toronto International Film Festivals.
Khumalo joined the cast of one of South Africa's longest running soap operas, Generations in 2005 as Busiswe (Busi) Dlomo, a refined and altruistic no-nonsense woman who heads up her own publishing empire, based in Cape Town.Her character happens to be the younger sister to Sibusiso Dlomo and has none of the power-hungry, egotistical and callous characteristics he(Sibusiso) has – she’s used her intellect and savvy to get where she is today, at the heaalm of South Africa's fictional top communications company-Ezweni which she runs with her brother and founder Karabo Moroka..