After performing in plays at St. Martin's Youth Theatre in South Yarra for a year, he gained the attention of Director John Duigan, who cast him in the 1987 film The Year My Voice Broke, the first part of a planned trilogy. Taylor also appeared in its sequel, Flirting (1991), alongside Thandie Newton with Nicole Kidman and Naomi Watts in early supporting roles.
Taylor's early roles included acting the lead in the critically acclaimed The Year My Voice Broke and Flirting and he gained significant international attention playing the tormented young Pianist David Helfgott in the 1996 film Shine. Taylor's résumé includes action movies (Lara Croft: Tomb Raider), comedies (The Life Aquatic with Steve Zissou), psychological thrillers (Vanilla Sky and Predestination) and historical dramas (Max, in which he played the young Adolf Hitler.)
He appeared in the video of "Fifteen Feet of Pure White Snow", a song by Nick Cave and the Bad Seeds, along with the video for "M.O.R." by British alternative rock group Blur. Taylor also starred in Simon Rumley's mystery thriller Red White & Blue, which had its world premiere as part of the SXSW Film Festival in March 2010. In 2011, he released his first EP Live Free or Die!!! with his band Noah Taylor & the Sloppy Boys on Z-Man Records.
On 14 November 2012, he married Dionne Harris, an Australian fashion designer. Taylor lives in Brighton, East Sussex.
In 2013, Taylor appeared in both the third and fourth seasons of HBO's epic fantasy series Game of Thrones, based on the A Song of Ice and Fire book series by George R. R. Martin. In the adaptation, Taylor plays the character of Locke, an original character of the television series, who serves as a condensed version of several characters of the books, most notably the ruthless and sadistic mercenary leader Vargo Hoat.