In a dressing room at the Saks Club on the third floor of the Fifth Avenue flagship, Rachel Zoe is advising a petite, strawberry-blonde 17-year-old shopping with her mother on how to wear a white sequin blazer. “I like to wear it a little bigger, so you can wear a zero or a two or a four,” she tells her. “If this part is too low,” she says, explaining the seam should not hit below the shoulder for the coolest slouchy effect, “you can’t cheat it.” As a stylist, movie stars pay Zoe a rumored $10,000 a day for such dressing advice, but today, she’s not just styling, she’s also up-selling her brand-new clothing line, Rachel Zoe Collection, which hit more than 100 retail sales floors in the U.S. and Canada four weeks ago.

The seventies- and boho-inspired wares, which include suiting, long dresses, blouses, sequin minidresses, and faux-fur vests, look exactly like something Zoe would wear. “It’s insta-chic,” she tells her next client, a 30-ish hedge fund manager, helping her into a camel cape. “I don’t mean to sound like a walking advertisement, but it is.” That $695 wool cape has already sold out at Nordstrom, which will reorder it before the weather actually feels like fall, at which time they’ll probably sell out of it again.

Zoe has been a boldfaced tabloid name since 2004, when she made over Nicole Richie in her boho-chic image. But she became a star in her own right after her Bravo reality show The Rachel Zoe Project debuted in 2008, with the last season finale attracting 1.1. million viewers (the show’s fourth season premieres tonight). So when her collection debuted at New York Fashion Week last February, it did so as yet another clothing line by a celebrity. But Zoe’s line, unlike a lot of celebrity lines, is neither cheap nor fleeting nor forgettably drab. The difference may be the fashion credibility she earned after working for many years behind the scenes, not only dressing folks like Britney Spears and Jennifer Garner, but styling fashion shoots for magazines like Harper’s Bazaar and ad campaigns for brands like True Religion.

No one knew that red-carpet stylists existed until Barbara Tfank famously dressed Uma Thurman in Prada for the 1995 Oscars (it was one of the first times a star appeared in something you could actually buy off the rack, as opposed to a specially made gown). Since then, none have become as famous as Zoe, thanks to the public's increasing fascination with the machinations of the fashion industry (thanks in part to reality shows like hers!) and the rapid proliferation of fashion websites in need of their own celebrities. Now stylists like Zoe, Nicola Formichetti (who became creative director of Mugler after styling Lady Gaga), and Taylor Tomasi-Hill (who consults for Sigerson Morrison) are almost as famous as the stars they dress, and creating a personality is part of the job — something agents look for when signing new talent.

For a first-time line, the Rachel Zoe Collection’s launch was unusually large. Nordstrom, Bloomingdale’s, Saks Fifth Avenue, Bergdorf Goodman, Neiman Marcus, and Intermix all picked it up, and they claim they’re already having trouble keeping the pieces, which range from $250 to $700, in stock. “It’s been a long time since we’ve taken that kind of risk with a first-time designer at Bloomingdale’s,” says Stephanie Solomon, the women’s fashion director at the chain, which normally launches new lines in only “a handful of stores” (the Zoe line is in eight). Nordstrom’s vice-president of designer apparel, Jennifer Wheeler, agrees that something felt different about this line: “It’s great when you have a name, but if you don’t have the goods — if the collection wasn’t good — it wouldn’t work,” she says. Nordstrom executives say the sell-through rate has quadrupled expectations. Colleen Sherin, senior fashion director of Saks, also describes the volume Saks bought of the collection as “unusual.” “It’s not just a one-season kind of thing,” Sherin says. “She’s in this as a serious business.”

Zoe, whose favorite words and phrases are maj (short for major),bananas, and “I die,” may not sound like your typical businesswoman. But she emphatically prefers to call herself that, rather than a “celebrity.” And the strategic moves she made in conceiving this line indicate that she is indeed a businesswoman — and a very good one. First, she partnered with Li & Fung, the highly successful manufacturer that did $16 billion in sales last year and counts House of Deréon, Jennifer Lopez’s Kohl’s line, and Sean John men’s sportswear among its brands. Catherine Moellering, executive vice-president of Tobe, a retail trend consulting company, suspects Li & Fung gave retailers confidence, practically speaking. She explains, “With Li & Fung, [retailers] feel very comfortable stepping out with it from a production standpoint. It’s going to be flawless, and there are not always great examples of celebrity start-ups that can execute. Li & Fung just knows how to do it — they understand the profitability dance.”

Second, Zoe positioned the line in an underserved part of the market. The price point of the Rachel Zoe Collection puts it “right on the cusp of bridge” — a category that includes Tory Burch and Elie Tahari — “which is consistently the most problematic in the department store puzzle,” Moellering says. Moellering wonders if Li & Fung, which boasts strong relationships with many retailers, tapped its network to find out where the greatest market share would be for Zoe: “In relation to the market, and where there is a void, that seems very smart to me.”

Zoe says she made a conscious decision about pricing “because I think that there are enough brilliant designers doing the designer clothes at this point.” She adds, “I was really maniacal about keeping prices down. And I remember there were certain pieces that I loved the sample, and I would sit with my design team and it was like this is this amount of money, and I was like, I'm not going above that price point. It's too expensive.”

She made a bold debut with tailoring, which is never easy to do and especially not for a first collection, including pantsuits in plaid, black, and tan. Sequined frocks and tiered cocktail dresses in cream and leopard also figure prominently. The outerwear included faux-fur vests and coats with faux-fur paneling — easy shortcuts for those who want to copy the stylist’s trademark look. The line is more L.A. glam than New York cool — stylish but not so stylish that it’s scary to casual observers of fashion.

Moellering easily sees Zoe’s brand becoming the “full-on lifestyle” kind, growing until it encompasses everything from clothes to jewelry to swimwear to fragrance. “Li & Fung, they’re not doing this to be a $20 million dollar business, they are doing this because they want it to be a multi-billion-dollar business.”

Zoe will tell you she works hard for all this. “I've worked with a lot of designers. I really understand the design process,” she says. “It is so much fun, but it is a lot of work. I picked this sequin out of ten thousand sequins, I picked this wool out of a hundred wools, I picked this faux fur out of four hundred samples of faux fur.” Such claims are not uncommon from celebrities with clothing lines, who often tell the press they know how to make great clothes when they’ve actually had little to do with the line that bears their name. But Zoe’s background as a stylist brings her extra credibility. “She’s a celebrity because she’s an incredible stylist,” notes Nordstrom’s Wheeler. “The two are very interrelated. She always had her finger on the pulse of where fashion is going, and she indeed helped push it in that direction. And she knows what makes women look good.” Though Zoe says she didn’t know her aesthetic would be huge on the runways when she launched the line, that’s exactly what happened. “Who really does boho and seventies better than Rachel?” Moellering says. “And those have to be two of the biggest trends right now.”

Zoe admits it’s not easy to go from stylist to designer in the rarified world of high fashion. “I have sat with these buyers and fashion directors of these retail stores for many, many years,” she says. “And the editor-in-chiefs and things — the thought of being judged by them is petrifying. Petrifying.” The added workload of the line is no small obstacle, either. New labels typically have much more time to plan their first collection than their second, third, fourth, and so on, and those subsequent collections really tell retailers how much endurance a line will have. Zoe says she is primed to handle the fabled pace of fashion. “Now I’m styling spring for the presentation in a couple of weeks, but the next day we started doing the fabrics and sketches for fall, so it’s kind of keeping your head in one place and being clear about what season you’re in. But I’ve always had to deal with that as a stylist and fashion editor as well — the models are wearing fur in June and bikinis in December.” She says you can expect the boot-cut pant in some iteration every season — along with sequins and faux fur, naturally. Also in the works: fragrance, jewelry, and beauty products.

Back to the Saks Fifth Avenue Club, when Zoe wraps up her visits with private clients, Saks CEO Steven I. Sadove pulls Zoe aside. “Did you see your windows? It’s our feature window,” he tells her. She hasn’t, but she will take a look after she greets a packed roomful of adoring fans at a cocktail reception a few floors up.

“I'm always going to style. It's the core of what I do. It's who I am. I love my clients,” Zoe says. Many of them will happily support her by wearing the line. But, Zoe adds, “If they wear it, great. If they don't, that's okay too. Definitely not forcing it in their faces.” And yet Jennifer Lopez, who is not a client of Zoe’s, has already worn pieces from the collection for two public appearances. InStyle endorsed it with a party in L.A. in June, where celebrities like Amber Valetta and Ali Larter happily wore the pieces. Marketing opportunities like that don’t just happen to anyone with a clothing line — and that is why a name like Zoe’s is so valuable.

This post has been updated to reflect Li & Fung's global sales volume for 2010.