Television and film Most of Duff's first few acting roles were small, starting off with an uncredited appearance in Hallmark Entertainment's western miniseries True Women (1997). She also served as an extra, again uncredited, in writer and director Willard Carroll's ensemble comedy drama Playing by Heart (1998). Her first major part was as the star of the 1998 film Casper Meets Wendy, playing the young witch Wendy who encounters the animated character Casper. Like Casper: A Spirited Beginning (1997), the first sequel to the hugely successful Casper (1995), the film went direct-to-video with generally unenthusiastic reviews.

Duff later appeared in a supporting role in the television movie The Soul Collector in 1999, which was based on a Kathleen Kane novel, and starred Bruce Greenwood as an angel who helps out a female farmer (Melissa Gilbert) whose husband has recently died. Duff ended up winning a Young Artist Award for Best Performance in a TV Movie or Pilot (Supporting Young Actress).

Duff's first serious shot at fame came when she was cast as one of the children in the pilot episode of the NBC sitcom Daddio (2000). Said Michael Chiklis, star of Daddio, "After working with her the first day, I remember saying to my wife, 'This young girl is going to be a movie star.' She was completely at ease with herself and comfortable in her own skin". Before the show had even aired, Duff was dropped from its cast lineup and became reluctant to continue her acting career. Her manager and mother, Susan Duff, spurred her on, and she successfully auditioned for the family comedy show Lizzie McGuire a week later.

Lizzie McGuire, which first aired on the Disney Channel in January 2001, was a ratings hit, drawing in 2.3 million viewers per episode, and became the career breakthrough Duff had been waiting for. Her participation in the show led to her becoming highly popular among children between the ages of seven and fourteen, with Richard Huff of the New York Daily News calling her "a 2002 version of Annette Funicello". After fulfilling her entire sixty-five episode contract, as well as participating in a film spin-off entitled The Lizzie McGuire Movie (2003), Disney toyed with the idea of continuing the franchise in further films and a prime-time television series to be broadcast on ABC, but Duff refused the proposal.

Duff's second role in a theatrical motion picture was in Human Nature, an independent film first shown at the Cannes and Sundance film festivals. Written by Charlie Kaufman and directed by Michel Gondry, the film follows a female naturalist, played by Patricia Arquette, who has body hair growing all over her body. Duff played the younger version of Arquette's character.

She starred in the Disney Channel television film Cadet Kelly (2002) with Christy Carlson Romano and Gary Cole, which became the network's most watched program in its nineteen-year history. Her first major role in a feature film was in Agent Cody Banks with Frankie Muniz in 2003, and it was successful enough to spawn a sequel which she did not participate in. After the commercially successful The Lizzie McGuire Movie, she played one of the twelve children of Steve Martin and Bonnie Hunt in the family film Cheaper by the Dozen, which remains her most widely seen film appearance. She reprised her role in the sequel, Cheaper by the Dozen 2 (2005), which failed to repeat the financial success of the original film and was panned by critics.

In 2004, Duff starred in the romantic comedy A Cinderella Story, a twenty-first century update of Charles Perrault's fairy tale Cinderella. The film became a moderate box office hit, and some critics were impressed by Duff's performance, as well as her chemistry with co-star Chad Michael Murray. Later that year, she starred in the romance film Raise Your Voice. The Las Vegas Weekly wrote: "Effortlessly combining Duff's bad acting and bad singing with bad writing and bad direction, Raise Your Voice is an insulting waste of time that begs to be silenced." While some critics praised Duff for appearing in a more dramatic role than she had previously been seen in, the film was heavily panned. Reviews were, by and large, negative to Duff's vocals (several critics have pointed out what appears to be her digitally enhanced voice ) and indifferent towards her acting performance, although she did receive a Razzie award nomination for "Worst Actress" (in addition to her work in A Cinderella Story). The film also received a muted reception at the box office, where it became Duff's least commercially successful film to date.

In Duff's next film, The Perfect Man (2005), she played the eldest daughter of a divorced woman (Heather Locklear) who moves to New York City as she desperately searches for a good man to settle down with. Reviews were uniformly negative, and it was a box office failure. She was nominated for a Razzie Award for both The Perfect Man and Cheaper by the Dozen 2.

Duff's next film is the satirical comedy Material Girls. The Martha Coolidge-directed film, co-produced by Madonna's independent film production company Maverick Entertainment, stars Duff and her real-life sister Haylie Duff as wealthy siblings who must fight to reclaim their fortune following a scandal. It will be released in the U.S. on August 25, 2006. The Duff sisters are also due to lend their vocal talents to the computer animated comedy Foodfight!, to be distributed by Lions Gate Films in 2007. The film's director, Larry Kasanoff, said that he is "absolutely thrilled to have Hilary and Haylie Duff as part of the cast".