After graduating from University of Sydney, Margaret Bailey returned to Queensland to teach. She had two stints at Rockhampton Girls' Grammar (1900-03, 1908-11) with a stint at Girton College, Toowoomba (1903-1907) in between.

For two years between 1912-14 she studied abroad. Upon returning she joined the staff at Ascham School in Darling Point, Sydney, which she purchased with another staff Her most adventurous move as principal was the 1922 introduction into the senior school of a modified version of the 'Dalton plan', a philosophy of learning which emphasises self-responsibility and independence. She resigned as principal of Ascham in 1946.

As the principal of Ascham School from 1916 to 1946, Bailey was active in the Headmistresses' Association of Australia and the New Education Fellowship.

She also served as vice-president and president of the Sydney University Women Graduates' Association, and was an executive member of the Australian Federation of University Women.

Sources used to compile this entry: Ascham School Website, 2009, http://www.ascham.nsw.edu.au/index.html; Lundie, Margaret, 'Bailey, Margaret Ann Montgomery (1879-1955)', in Australian Dictionary of Biography Online, Australian National University, 2006, http://www.adb.online.anu.edu.au/biogs/A070144b.htm.