Born in Kampala, Lule was educated at King's College Budo (1929–34), Makerere University College, Kampala (1934–36), and Fort Hare University at Alice, South Africa (1936–39). He was a great sportsman in the 1930s, mainly in athletics (880-yard dash) where he was national champion.
He was principal of Makerere University College from 1964 to 1970, and was assistant secretary-general of the Association of African Universities, in Accra, Ghana, between 1973 and 1978. Lule served as a minister in the pre-independence British colonial government and later as an assistant secretary-general of the Commonwealth Secretariat. He went into exile after Idi Amin came to power.
As the leader of the Uganda National Liberation Front (UNLF), Lule was installed as President after neighbouring Tanzania ousted Idi Amin with help from the UNLF after his failed attempt to annexe portions of Tanzania (see Uganda–Tanzania War). Lule was the first of a swift succession of Ugandan leaders before the eventual return of Milton Obote in 1980.
Lule's government adopted a ministerial system of administration and created a quasi-parliamentary organ known as the National Consultative Commission (NCC). The NCC and the Lule cabinet reflected widely differing political views. In June 1979, following a dispute over the extent of presidential powers, the NCC replaced Lule with Godfrey Binaisa.
Out of office, he led the Uganda Freedom Fighters (UFF), a resistance group which joined with Yoweri Museveni's Popular Resistance Army (PRA) in 1981. The combined National Resistance Army (NRA) eventually succeeded in overthrowing Tito Lutwa Okello and taking power in 1986.