Sundgaard was last seen at a party on Cedar Street in Alexandria, Minnesota during the early morning hours of April 19, 1987, Easter Sunday. She has never been heard from again. Her vehicle was found parked a few blocks away the following morning. Sundgaard's purse and asthma inhaler were inside it. Her loved ones stated her asthma had been bothering her in the days leading up to her disappearance and they did not believe she would have left her inhaler behind. Sundgaard also left behind her two young sons, which is uncharacteristic of her.

A week before her disappearance, Sundgaard told her sister she planned to leave her husband and move out of the area. The couple had two young sons and Sungaard stated she was violent and she did not trust him around the children. Sundgaard's husband was investigated by police but is not considered a suspect in his wife's disappearance. One of the last people known to have seen her, Michael Dale Benson, was convicted of raping an Alexandria woman in 1989. He was incarcerated, and later civilly committed to a hospital for life. He escaped from the hospital in 2006, but was apprehended several weeks later. While in custody, Benson told authorities he had raped five other women in Colorado and California. He is considered a suspect in Sundgaard's case, but maintains his innocence and has not been charged in connection with it.

Sundgaard's disappearance remains unsolved. Her family does not believe she would have abandoned her children.