Daryl started his career at Waterford United where he was named as PFAI Young Player of the Year for 2004. During his time at Waterford he had trial spells at Southend United and Luton Town. But in the summer of 2005 he signed for Sunderland for a reported fee of £100,000. A number of clubs including Aberdeen and Ipswich Town were reported to have been interested in Murphy before Mick McCarthy swooped.

Daryl went on loan to Championship side Sheffield Wednesday, but was recalled to the 'Black Cats'. His first Premiership goal was a last minute equaliser against Tottenham Hotspur in February 2006. He went on to make over a hundred appearances for Sunderland, scoring fourteen goals, while enjoying a spell on loan with Ipswich Town during the 2009/10 season.

Daryl joined Celtic in July 2010 and made eighteen league appearances, scoring thrice, in his first season at the club. The following two seasons were spent on loan at Ipswich Town, where he made seventy-four appearances in total, scoring eleven goals, in the Championship. Daryl joined Ipswich permanently in June 2013.

Daryl has previously been called up to the Republic of Ireland senior squad and, ahead of the 2016 European Championship, he has 21 caps to his name. He was included in the Republic of Ireland's final squad for the 2016 European Championship. In January 2018, Daryl announced his retirement from international football after amassing 33 appearances, scoring 3 goals in the process.

In December 2020, Daryl re-signed for Waterford.