Peggy Scott was introduced to the Bauer family in 1965. A sweet, innocent fifteen year old, Peggy was raised by her mother, Maggie, ever since her father deserted them when she was a toddler. Apparently when Maggie was a senior in high school, she went against her parents' wishes and married Ben Scott, who was serving in the Korean War. Soon Maggie became pregnant, and she gave birth to Peggy while Ben was overseas. After Ben returned, Maggie realized that the marriage had been a mistake. Ben turned out to be a gambler who passed rubber checks and avoided any opportunity to make an honest living. He ran out on the family and Maggie divorced him for desertion. Shortly after Maggie relayed this story to her friend and boss, Bill Bauer, Ben returned! His criminal days behind him, Ben bought a restaurant and told Maggie he wanted to reconcile. Maggie was hesitant and tried to keep him from seeing Peggy, so Ben secretly introduced himself to his daughter as a friend of her father, who was on a secret mission in Europe. The impressionable young girl was won over by this charming man, and eventually Maggie discovered that Ben had established contact with Peggy. Later, with Maggie present, Ben revealed to Peggy his true identity and his criminal past. Peggy was so elated that she could not wait for her parents to get back together! Meanwhile, in 1967, Peggy was falling in love with Johnny Fletcher, an 18-year-old who was feeling alienated by his father's marriage to Robin Lang. In the meantime, Peggy was happy when Maggie remarried Ben, although she was unaware that Ben had blackmailed Maggie into marriage. The marriage was in name only and was further weakened by Ben's strict, overprotective parenting of Peggy. Meanwhile, Bill Bauer fell off the wagon and, during one of Bill's most acute alcoholic stupors, he mistook Peggy for Maggie and revealed their past affair to the confused teenager. Peggy confronted Maggie and then made plans to elope with Johnny, who was fed up with his own sad family situation. Their plan was foiled, however, when Peggy was injured in a car accident.

Meanwhile, Johnny stood to inherit $ 3 million when he turned 25 and asked Paul, and grandfather, the wealthy Henry Benedict, to advance him the money. Paul thought Johnny was much too young to marry and was relieved and pleasantly surprised when Henry said no to Johnny. Undaunted, after the new year of 1968, Johnny and Peggy obtained a marriage license on Peggy's eighteenth birthday. Unfortunately, Ben found it, went to Johnny and in the course of an argument, suffered a massive coronary and died. Not long after, in March, Bill's son, Ed,operated on Maggie when she was suffering from a serious intestinal ailment. Peggy had finally made peace with her mother, only to have Maggie die under Ed's scalpel. Following Maggie's death, Bill apologized to Peggy for his indirect role in hurting her and Peggy became like a daughter to Bill and his wife, Bert. Deeply disturbed by the death of her parents, Peggy broke up with Johnny and embarked on a nursing career, like her best friend, Leslie Jackson Bauer.

Soon after becoming a nurse, Peggy fell for a patient named Marty Dillman. Marty became a patient of Ed's after he was stabbed in a gang rumble. If not for Ed's surgical ability, Marty probably would have died. Soon, Peggy learned that Marty wasn't a stereotypical gang leader; he was an unprincipled, thrill-seeking rich boy who had been spoiled rotten by his widowed mother, Claudia. Innocent Peggy was immediately charmed by Marty with his superficial intelligence and artificial wit. Unfortunately, things would go awry in this budding romance. Soon after Johnny became involved with Tracey Delmar, Flip Malone told Marty about Tracy's true identity:Charlotte Waring. Without Peggy's knowledge, Marty blackmailed Tracy for big bucks and split the take with Flip. At the same time, Tracy married Johnny. Meanwhile, Marty was not pleased to learn that Peggy was pregnant with his child and he married her reluctantly. Both marriages were mercifully short lived. When Peggy overheard a conversation between Marty and Tracy, she wrongly suspected they were having an affair. Distraught and weak from her pregnancy, Peggy blacked out. When she came to, Marty had vanished! He was later found near a lake, with a fractured skull and a knife wound to his neck.

The police booked Peggy for Marty's murder, and she went on trial with Mike Bauer as her attorney, Mike arranged for Peggy to leave jail temporarily and go to Cedars for the birth of her son, whom she named William Bauer Dillman. With Marty dead and Peggy's life in shambles, Tracy finally revealed her true identity as Charlotte Waring and confessed that she'd been after Sara's money all along. Johnny annulled their charade of a marriage, but Charlotte was determined to redeem herself. Sharing Mike's suspicion that Flip was Marty's real killer, Charlotte began dating the grease monkey in order to obtain the necessary proof. One night Flip drunkenly revealed to Charlotte that Marty had planned to double-cross him in their blackmail scheme and skip town. He showed her the airplane ticket Marty had intended to use. Guessing correctly that Flip had snuffed out Marty, Charlotte waited until Flip was asleep, then sneaked out with the ticket and turned it over to Mike. Later, when Mike was grilling Flip on the witness stand, the shrewd lawyer produced the plane ticket and introduced it as evidence. Cornered, Flip confessed to the brutal murder of Marty and was imprisoned.

Now that Peggy was free, she finally married Johnny, who adopted Billy. Unfortunately this marriage would fail also. In 1970, Johnny became obsessed with building his medical career and becoming a prominent doctor like his father. However, the pressure was too much for him and Johnny starting irrationally accusing Dr. Joe Werner of favoring the self-centered Dick Carey over him. Obsessed, Johnny worked himself to a point of mental and physical exhaustion and had to be hospitalized. Though Peggy tried to be supportive of him, a depressed Johnny never fully recovered. Johnny left Peggy, in 1971, to "find himself" and was never seen or heard from again. Abandoned and alone, in 1972, Claudia Dillman, the grandmother of Peggy's son Billy, got wind of John's illness and desertion, and threatened to sue Peggy for custody of Billy. Happily, Claudia had an attack of conscience, backed off and left town again.

Johnny's desertion left Peggy vulnerable to the charms of Roger Thorpe in 1973. Though he was hated by almost everybody in town, Peggy was certain that Roger had a sensitive side that could be nurtured. Roger proposed to Peggy, in 1974, but she turned him down as she was still legally married to Johnny. In 1975, Peggy finally filed for divorce and agreed to marry Roger. Soon after, Peggy was devastated to learn from Ed that Chrissy was the product of an affair between Roger and Ed's wife, Holly! Shocked, Peggy threw Roger out. Roger then left town, and when he came back, in January 1976, one of the stipulations that Peggy put on him, in order to get back into her good graces, was that he get a vasectomy. Roger reluctantly agreed and he and Peggy married in February 1976, with only Adam Thorpe and Bert Bauer in attendance. Months later, Roger's father would finally learn of Roger and Holly's affair and the fact that Chrissy was Roger's child. Adam confronted Roger and refused to forgive him until Peggy convinced him otherwise.

Unfortunately, the Thorpe marriage would break down due to the case of the Granger family vs. Rita Stapleton. That fall, Nurse Rita Stapleton found herself on trial for the murder of her former patient, Cyrus Granger, in Texas. However, unbeknownst to everyone, Roger had a past with Rita, a past that he strongly coerced Rita into keeping secret. However, the cost of that secret could have been Rita's freedom. Under stress about Rita, Roger suddenly started verbally abusing Peggy. After keeping silent for weeks and coercing Rita to do the same, at the eleventh hour, in April 1977, Roger finally confessed that Rita couldn't have committed the murder since, on the night in question, she was making love to him! Unnerved that Roger waited so long to reveal the truth, Peggy decided that he wasn't trustworthy and divorced him. Disgraced, Roger left town. As a result of Roger's actions, Billy was ridiculed in school and Peggy decided to leave Springfield and move to Boise, Idaho. Before she left town, Peggy stopped by Ed's office to warn Ed that if Roger ever came back to town that Roger might become violent.

Later, on May 3rd, 1979, Peggy received a surprise visit by a lawyer named Derek who was asking about Roger. Peggy's bitterness at Roger showed when she suddenly demanded to know what had Roger done now or been accused of doing. When Derek told Peggy that Roger was being accused of raping his wife, Holly, it came to no surprise to Peggy. A month later, Peggy was talked into briefly returning to Springfield to help out at Cedars. Staying with Bert, she provided emotional support the Bauer family when Holly was put in prison for Roger's "murder." Peggy was also involved, at Cedars, in helping the injured Lainie Marler recover the use of her legs, treating Holly when she was brought in from prison due to a kinife wound, and was on call in the Emergency Room when Ben McFarren was brought in for treatment after a nasty fall at the Wexler Estate. Shortly after, to get away from the scandal surrounding Roger, Peggy left Springfield again and returned to Idaho.