Olivia Palermo: New York doll

Truman Capote called them swans. Briton Hadden, the co-founder of

Poised and as focused as a laser beam, she appears much older than her years, something she says she owes to surrounding herself with older friends. At the restaurant in Evening Standard hotel in her native New York, she orders an iced cappuccino and politely refuses food. Her face is doll-like, with huge brown eyes, dimples and perfect skin. Her outfit – and it's really her outfits that have won her hordes of young fashion-hungry fans – is so perfectly put together that even in a city like New York, where women are assiduously groomed and preened, she turns heads. She is wearing a cream shirt designed by Carine Roitfeld's husband Christian Restoin, leather shorts from Tibi, a Topshop belt, sky-high heels by Kurt Geiger and statement costume jewellery.

'You need to have a long-term plan,' she says of her rise to fame. 'You can't look at it like a deer in the headlights and only think about being in the moment. From the very first day I decided to start all of this I thought, "This has to be lasting. How is this going to work in 15 years?" That's how I look at it.' What insightful business sense, I say. 'Well, I'm a New Yorker,' she replies.

What her career will look like in 15 years, however, she won't say. She doesn't want to 'jinx' any upcoming projects by talking about them. But the strategy does involve acting – she plans to take classes – and designing, when the right collaboration comes along. This is the strategy of a woman who knows how to cash in on her moment and turn her beauty, ambition and love of fashion into a business.

Olivia first gained notoriety on account of her über-bitch role in the MTV reality show The City. The show was a spin-off from The Hills, which starred a young student and later Teen Vogue staffer, Lauren Conrad, and her decorative friends as they attempted to make it in LA. The more urbane sequel charted the heady life of an up-and-coming fashion designer, Whitney Port, and her interaction with New York's fashion mavens, such as Palermo, who was working at American Elle magazine. Olivia's on-screen transgressions included refusing to wear Guess clothes to a Guess party, not showing up to conduct an interview, snubbing Port and being rude and dismissive of Erin Kaplan, the head of PR at the magazine.

'I am the furthest thing from a bitch. It's a scripted reality show,' she says of the process whereby producers set up altercations, feed lines to the stars, and reshoot scenes to emphasise conflict and drama. 'I was just playing a part. I don't like to say that it was all due to editing but I think editing does a very interesting thing.' (Not interesting enough, apparently, since plans for a third season have recently been cancelled.)

But it all really started for Olivia with society photographer Patrick McMullan, the documenter of New York nightlife. Wannabe socialites routinely scan his website, where he posts party pictures, to count how many times they've been snapped. 'Everything kind of worked out really nicely,' she says. 'Patrick took my picture [in April 2006], and my girlfriends and I were getting involved in various New York charity
fundraising events. That's where it all started. I have always been one to give back whenever I can, absolutely. Any chance I get to help.'

From a few photo opportunities at the right parties, courtesy of McMullan, her prominence in the diary pages rose and invitations flooded in. Next, she did what all ambitious New York fashionistas do: she hired a publicist. And then there was a well-timed scandal that landed her name in the New York Post's Page Six gossip column. An anonymous website called Socialite Rank popped up in 2006 and started ranking New York's It girls, with points awarded for outfits and frequency of attendance at prestigious events. It pitted Olivia as the rival to the city's number one It girl Tinsley Mortimer, the pretty blonde daughter of a wealthy Virginia rug salesman who married into New York society (the two rivals reportedly had a run-in at a charity fashion show, where Mortimer allegedly bumped into Palermo deliberately backstage and made her lose her footing). 'Next time you think about skipping that certain gala, wearing that unknown designer, dating some weird band member, beware,' the website wrote. 'We're watching. And your ranking is on the line!'

Next the site ran a story with the headline: 'Exclusive! Olivia Palermo Loses Her Mind and Shocks Socialite World!' It called her the 'social-climbing heroine of the moment' and posted a letter she had supposedly written to New York's society girls apologising for being too pushy. 'I know I have gotten off on the wrong foot with many of you and there may even be some of you that do not like me,' the letter said. 'But I feel that those feelings are more a creation of websites like Socialite Rank, rumours and gossip than they are to [sic] your own experiences.' Except Olivia didn't write the letter. Her father, a real-estate developer, hired a powerful lawyer and a month later Socialite Rank disappeared from the web. Palermo somehow came out of the incident smelling of roses.

Of the backstabbing and bullying she says, 'It's something I have always experienced since I was a kid. I have always been taught to rise above it and be the bigger person. That's the best advice I can give someone. It's a part of life, and what doesn't kill you makes you stronger.'

Olivia manages to be both friendly and guarded at the same time. While she politely bats off questions about her rise to fame, her eyes light up at the subject of fashion. She gives considered, careful answers with the well-to-do diction of the Upper East Side. She doesn't base her career – or her look, for that matter – on anyone else's. 'I'm me,' she says. But she does count Rosalind Russell, the star of the 1940 film His Girl Friday, Audrey Hepburn, Humphrey Bogart and Cary Grant as her style icons. She is fronting advertising campaigns for Mango and Hogan, and is muse and collaborator to several designers including Tommy Hilfiger. She is signed to the Wilhelmina modelling agency alongside her boyfriend Johannes Huebl, Fergie from the Black Eyed Peas and Nicole Scherzinger from the Pussycat Dolls.

'I come up with everything on my own,' she says of her collaborations. 'I have a great team, but for the most part I make all my own decisions. I set the tone for how I want to run my business.' One thing she doesn't mind being called is an It girl. 'I love it! You want to see an eclectic group of people and fresh faces [in fashion]. It girls have always been there. Growing up on the Upper East Side, that's probably where I get it from, seeing all these older ladies who are just so elegant and polished. I love 1950s and 1960s glamour, to me that's the ideal of fashion. I just love that era and I look to it for inspiration, always. I think it's important to have that Hollywood glamour in our culture today because you can't just have pop culture.'

Of her much-applauded style, she says, 'My best, favourite outfits are things that I have put together in two seconds. When I travel to certain cities, I know what their overall look is so I can adapt. For example, in London I always know to take a leather jacket because things are more edgy. In Paris, having a blue and white striped shirt and a really elegant chiffon dress make one more at ease. Then in New York you are always a bit more polished because we are so work-driven – you just need to have that pulled-together look.'

She counts her mother, an interior designer – 'I definitely get an eye from her' – as one of her style inspirations. Also, her aunt Linda Donahue, who spent 25 years working in the couture department of Doyle, the New York auction house. 'I had a good childhood. I had very supportive parents who were always encouraging me to do what I wanted to do and that has helped me as an adult.'

Her parents divorced when she was still at school, so she split her time between the wealthy town of Greenwich, Connecticut, where her father lives, and the Upper East Side with her mother. She attended a school in the city for children with learning difficulties. 'When I was younger I had a learning disability,' she says. 'But I have overcome it. You get through it.' Then, in 2007, her father lost a claim for bankruptcy after it was reported he owed $2.75 million to a creditor and had been missing alimony payments. Her university education has been peripatetic; she is currently reading media studies at The New School, a university in New York which includes the prestigious Parsons School of Design among its colleges. She also studied in Paris at the American University. 'It's taking a long time, but I think I can take some time with it. I am trying to balance everything. I know that I can go back and I will. I take every other semester off and then go back.'

She and Huebl, her German boyfriend of three years, spend more time in Europe than in New York, she says. They met through mutual friends in New York and keep up a hectic travel schedule, never going longer than seven days without seeing each other. They share an apartment in Brooklyn, and own a dog together, a Maltese called Mr Butler. In the winter months, the couple spend as much time skiing as they can and flee to Utah, Vermont and Switzerland. 'Anywhere that has a powder of snow, I am there,' she says.