Her first marriage, to a London art dealer, and the birth of her daughter Dinora Mendelson, limited her opportunities to paint during the 1920s but she studied the work of Walter Sickert, Jacob Epstein, Jacob Kramer, and David Bomberg during this time. She married David Bomberg after visiting him in Spain in 1929. Holt did not resume painting until 1945, focusing instead on supporting Bomberg's career. While Bomberg was teaching at the Borough Polytechnic Institute, Holt was a founding member of the Borough Group, a collective of painters influenced by Bomberg, and participated in group exhibitions. Holt and Bomberg moved to Ronda, Spain from 1954–57, before returning to England due to Bomberg's failing health. After Bomberg's death, Holt focused on her own work, traveling to Mexico, Basutoland, Andalusia, Yugoslavia, Morocco, Turkey, and Iceland to paint, as well as continuing to promote Bomberg's legacy.
Exhibitions of Holt's work include Paintings and Drawings by David Bomberg (1890-1957) and Lilian Holt (1971) at the Reading Museum and Art Gallery and her first solo exhibition, Lilian Holt: Paintings and Drawings (1980) at the Ben Uri Gallery, when she was in her seventies. Posthumous exhibitions include the 1992 group exhibition Ten Decades: Careers of Ten Women Artists Born 1897-1906 at the Norwich Gallery and the 1985 solo exhibition A Tribute to Lilian Bomberg at Fischer Fine Art in London.
Her painting Tajo, Ronda (1956) is in the permanent collection of the Tate Gallery. She is also the subject of paintings by David Bomberg, including Lilian (1932) and Lilian Painting David (Painting Lilian) (1929).