In the 1999 election, Chadwick stood as the Labour Party candidate for the Rotorua seat, and defeated incumbent National Party MP Max Bradford. At the 2005 election she was narrowly returned to Parliament by 662 or 2.2% more votes than her opponent. In 2006, Chadwick's Shop Trading Hours Act Repeal Amendment Bill was drawn from the member's ballot. The bill passed its first reading and was sent to select committee, but was narrowly defeated at the second reading, 64 to 57. In 2007, she was appointed to Cabinet as Minister of Conservation and Women's Affairs, as well as becoming an Associate Minister of Health. In the 2008 general election, Chadwick lost her seat to National's Todd McClay, whose margin was over 5000. Chadwick's loss was predicted by some commentators due to boundary changes which incorporated more rural areas into the electorate. However, due to Chadwick's list place of 30 she was able to return to parliament. In 2010, Chadwick attempted to introduce a bill to Parliament to partially liberalise abortion law. This bill was defeated at the caucus stage and was not brought before Parliament. Chadwick failed to regain her seat in the 2011 election, losing to Todd McClay by a margin of more than 7,000 votes. On 27 November 2011 she announced that she would be retiring from politics. As a cabinet minister, Chadwick was entitled to the title of The Honourable and became The Hon. Mrs Stephanie Chadwick which is a title she was granted for the rest of her life after leaving parliament.
Mayor of Rotorua
Chadwick announced in 2013 that she would be running for Mayor of Rotorua in the local elections of that year, challenging sitting mayor Kevin Winters. Chadwick defeated Winters and three other candidates, receiving more than 11,000 votes of a total 19,596 votes cast. At the 2016 Rotorua Local Body Elections, Chadwick again ran for mayor, defeating six other candidates, receiving 8,990 of a total 21,408 votes cast Chadwick's husband, John Chadwick, died in Rotorua on 26 May 2017. In 2020, Chadwick announced a zero percent rates increase in the Rotorua Lakes Council's 2020/2021 annual plan to cushion the financial blow of the COVID-19 pandemic, which had severly impacted the district's tourism industry.