While attending Pasadena Junior College, he became involved in local radio plays. He was spotted by a talent scout from Paramount Pictures in 1937 and appeared in his first film the following year.
In 1954, Holden won the Best Actor Academy Award for his role in the World War II film Stalag 17 (1953). Late in his career, he landed another Oscar nomination for his starring turn in Network (1976).
Holden was married to actress Brenda Marshall from 1941 until their divorce (after many long separations) in 1971. They had two sons. He also adopted his wife's daughter from her first marriage.
Holden suffered from alcoholism and depression. In 1966, he was involved in a car accident in Italy in which the other driver was killed. It was determined that Holden had been driving under the influence of alcohol; he was charged with vehicular manslaughter and received an eight-month suspended prison sentence. Holden was overcome with guilt, and friends said this led to even heavier bouts of drinking.
William Holden died as the result of a fall in 1981. He was alone and heavily intoxicated when he apparently slipped on a throw rug, severely gashed his head on a night table, and bled to death. He was dead for several days before his body was found. Holden was 63 years old.