In her third film, she won the Academy Award for Best Supporting Actress for the 1980 film Melvin and Howard, playing Lynda Dummar, the wife of Melvin Dummar, then a trucker and aspiring singer, who claimed to have befriended reclusive eccentric Howard Hughes. Another notable film appearance came in the well-received 1983 film Cross Creek, in which she played Marjorie Kinnan Rawlings, author of The Yearling. In 1985, she also starred in the movie One Magic Christmas as a mother and wife who falls on devastating times at Christmas only to rely on a Christmas miracle to save her family. In 1989 she played Karen Buckman, the wife of Steve Martin’s character in Parenthood. In Back to the Future Part III (1990), Steenburgen played Clara Clayton, a school teacher who falls in love with Doc Brown, played by Christopher Lloyd. She was persuaded to play the role by her children, as well as by fans of the Back to the Future films, and reprised the role by providing the character's voice in Back to the Future: The Animated Series.