Lloyd's first major motion picture role was as a psychiatric patient in One Flew Over the Cuckoo's Nest. However, he may be most remembered for his roles as Reverend Jim Ignatowski, the ex-hippie cabbie on the TV sitcom Taxi, and as the eccentric inventor Emmett "Doc" Brown in the Back to the Future trilogy of movies, where he starred with Michael J. Fox. Lloyd later reteamed with Fox, when he made a guest appearance on the sitcom Spin City.

Other notable roles for Lloyd were the Klingon Commander Kruge in Star Trek III: The Search for Spock and the villain Judge Doom in Who Framed Roger Rabbit.

Lloyd also appeared as the lead character in the computer game Toonstruck. He does the voice of The Hacker on the children's cartoon show Cyberchase on PBS. In 1999, Lloyd starred in the movie It Came From the Sky with Yasmine Bleeth. On one episode of Malcolm in the Middle, he plays Hal(Malcolm's Dad)'s father.

Lloyd rarely appears in public or gives interviews.

Lloyd currently appears in the role of a retired rocket scientist on the Fox sitcom Stacked, opposite Pamela Anderson Lee.