Reed first found prominence as the guitarist and principal singer-songwriter of The Velvet Underground. The band, which lasted from 1965 until 1973 (with Reed departing in late 1970 during the Loaded sessions), gained relatively little notice during its life but is often considered the seed from which most alternative traditions of rock music sprang. As the Velvets' songwriter, Reed wrote about such taboo subjects as S&M ("Venus in Furs"), transvestites ("Sister Ray"), transsexuals ("Lady Godiva's Operation"), prostitution ("There She Goes Again"), and drug addiction (“I'm Waiting for the Man”, "White Light/White Heat", “Heroin”). As a guitarist, he made innovative use of abrasive distortion, volume-driven feedback, and nonstandard tunings. Reed's flat, New York voice, stripped of superficial emotions and, like Bob Dylan's, flaunting its lack of conventional training, was no less important to the music's radical effect.

Reed began a long and varied solo career in 1972. He scored a hit that year with Walk on the Wild Side. For more than a decade he then seemed purposely to evade mainstream commercial success. One of rock's most volatile personalities, Reed made inconsistent albums that frustrated critics who wished for a return of the Velvet Underground. The most notable example is 1975's infamous double LP of recorded feedback loops, Metal Machine Music, upon which Reed later commented, "no one is supposed to be able to do a thing like that and survive."

Despite erratic turns, Reed's work won him by the late 1980s wide recognition as an essential elder statesman of rock. He had for decades written frankly on subjects more intense than the genre had seemed capable of handling. The industry had matured, to the extent that his commercial position as an "art rocker" was secure.