In the early 1970s, Peterson moved to Italy and became lead singer of the Italian rock bands Latins 80 and The Snails. Introduced to film director Federico Fellini by the producer of a documentary on Las Vegas showgirls in which she had appeared, she landed a small part in the film "Roma" (1972). Back in the United States, she toured nightclubs and discos around the country with a musical/comedy act, Mammas Boys. In 1979, she joined the Los Angeles-based improvisational troupe The Groundlings, where she created a Valley girl-type character upon whom the Elvira persona is largely based.