Lit Lounge was noted as a major venue for New York City's hipster subculture in the mid- to late 2000s, particularly the indie rock and electroclash scene of the era.

[2] In 2010 the bar was the subject of protests during a request for a license transfer for a new venture, in which local residents claimed Lit frequently played music past 4 a.m. on weekends and contributed to crowding on sidewalks.

"[7] Rising rents and the changing social scene of the East Village were cited as primary reasons for the closure, with the majority of Lit Lounge's clients having migrated to the Brooklyn neighborhoods of Bushwick, Greenpoint, and Williamsburg.

[10] Foss and Schwartz announced plans to reopen Lit Lounge at a location in the McKibbin Street Lofts in East Williamsburg, Brooklyn, that was at the time occupied by the Currant Cafe, a restaurant they opened in March 2014.

[11][16] Notable artists who performed or exhibited at Lit include actors Mike Myers and Leo Fitzpatrick; photographers Ryan McGinley and Mick Rock; filmmaker Spike Jonze; and musicians Karen O, Nick Zinner, David Yow, and James Iha.