He is known for portraying Emmett Brown in the Back to the Future trilogy (1985–1990) and Jim Ignatowski in the comedy series Taxi (1978–1983), for which he won two Emmy Awards.

Lloyd came to public attention in Northeastern theater productions during the 1960s and early 1970s, earning Drama Desk and Obie awards for his work.

He made his cinematic debut in One Flew Over the Cuckoo's Nest (1975) and went on to star as Commander Kruge in Star Trek III: The Search for Spock (1984), Professor Plum in Clue (1985), Judge Doom in Who Framed Roger Rabbit (1988), Uncle Fester in The Addams Family (1991) and its sequel Addams Family Values (1993), Switchblade Sam in Dennis the Menace (1993), Mr. Goodman in Piranha 3D (2010), Bill Crowley in I Am Not a Serial Killer (2016) and David Mansell in Nobody (2021).

Lloyd earned a third Emmy for his 1992 guest appearance as Alistair Dimple in Road to Avonlea, and won an Independent Spirit Award for his performance in Twenty Bucks.

He has done extensive voice work, including Merlock in DuckTales the Movie: Treasure of the Lost Lamp, Grigori Rasputin in Anastasia, the Hacker in the PBS Kids' Cyberchase, which earned him Daytime Emmy nominations, and the Woodsman in Cartoon Network's Over the Garden Wall.

"[3] He made his Broadway debut in the short-lived Red, White and Maddox (1969), and went on to Off-Broadway roles in A Midsummer Night's Dream, Kaspar (February 1973),[8] The Harlot and the Hunted, The Seagull (January 1974),[9] Total Eclipse (February 1974),[10] Macbeth, In the Boom Boom Room, Cracks, Professional Resident Company, What Every Woman Knows, The Father, King Lear, Power Failure and, in mid-1972, appeared in a Jean Cocteau double bill, Orphée and The Human Voice, at the Jean Cocteau Theater at 43 Bond Street.

[3] He performed in Andrzej Wajda's adaptation of Fyodor Dostoevsky's The Possessed at Yale Repertory Theater,[12] and in Jay Broad's premiere of White Pelican at the P.A.F.

"[14] His first film role was psychiatric patient Max Taber in One Flew Over the Cuckoo's Nest (1975), alongside future co-star Danny DeVito.

Other roles include Klingon Commander Kruge in Star Trek III: The Search for Spock (1984) (on suggestion of fellow actor and friend Leonard Nimoy), Professor Plum in Clue (1985), Professor Dimple in an episode of Road to Avonlea (for which he won a Primetime Emmy Award for Outstanding Lead Actor in a Drama Series),[16] the villain Judge Doom in Who Framed Roger Rabbit (1988), Merlock the Sorcerer in DuckTales the Movie (1990), Switchblade Sam in Dennis the Menace (1993), Zoltan in Radioland Murders (1994), and Uncle Fester in The Addams Family (1991) and Addams Family Values (1993).

In November 2007, Lloyd was reunited onscreen with his former Taxi co-star Judd Hirsch in the season-four episode "Graphic" of the television series Numb3rs as Ross Moore.

He then played the role of Ebenezer Scrooge in a 2008 production of A Christmas Carol at the Kodak Theatre with John Goodman and Jane Leeves.

In May 2013, Lloyd appeared as the narrator and the character Azdak in the Bertolt Brecht play The Caucasian Chalk Circle, produced by the Classic Stage Company in New York.

[28] In March 2021, Lloyd played the best friend of William Shatner in the romantic comedy film Senior Moment, also starring Jean Smart.

"[32] In March 2022, Lloyd appeared in a promotion for the time travel film The Adam Project along with two of its stars, Ryan Reynolds and Mark Ruffalo.