His more serious writings begin early with the Enchiridion militis Christiani, the "Handbook of the Christian Soldier" (1503) (translated into English a few years later by the young william Tyndale). (A more literal translation of enchiridion - 'dagger' - has been likened to "the spiritual equivalent of the modern Swiss Army knife.") In this short work, Erasmus outlines the views of the normal Christian life, which he was to spend the rest of his days elaborating. The chief evil of the day, he says, is formalism - going through the motions of tradition without understanding their basis in the teachings of Christ. Forms can teach the soul how to worship God, or they may hide or quench the spirit. In his examination of the dangers of formalism, Erasmus discusses monasticism, saint worship, war, the spirit of class and the foibles of "society."

Erasmus preferred to live the life of an independent scholar and made a conscious effort to avoid any actions or formal ties that might inhibit his freedom of intellect and literary expression. Throughout his life, he was offered positions of honor and profit in academia but declined them all, preferring the uncertain but sufficient rewards of independent literary activity. From 1506 to 1509, he was in Italy: in 1506 he graduated as Doctor of Divinity at the Turin University, and he spent part of the time as a proofreader at the publishing house of Aldus Manutius in Venice. According to his letters, he was associated with the Venetian natural Philosopher, Giulio Camillo, but, apart from this, he had a less active association with Italian scholars than might have been expected.

One of Erasmus's best-known works, inspired by De triumpho stultitiae (written by Italian humanist Faustino Perisauli), is The Praise of Folly, published under the double title Moriae encomium (Greek, Latinised) and Laus stultitiae (Latin). A satirical attack on superstitions and other traditions of European society in general and the western Church in particular, it was written in 1509, published in 1511, and dedicated to Sir Thomas More, whose name the title puns.

Erasmus had been working for years on two projects: a collation of Greek texts and a fresh Latin New Testament. In 1512, he began his work on this Latin New Testament. He collected all the Vulgate manuscripts he could find to create a critical edition. Then he polished the language. He declared, "It is only fair that Paul should address the Romans in somewhat better Latin." In the earlier phases of the project, he never mentioned a Greek text:

The first New Testament printed in Greek was not by Erasmus but by Cardinal Francisco Jiménez de Cisneros, as part of the Complutensian Polyglot. This portion was printed in 1514, but publication was delayed until 1522 by waiting for the Old Testament portion, and the sanction of Pope Leo X. The delay allowed Erasmus' Greek New Testament to be published first, in 1516.

The Institutio principis Christiani (Education of a Christian Prince) (Basel, 1516) was written as advice to the young king Charles of Spain (later Charles V, Holy Roman Emperor). Erasmus applies the general principles of honor and sincerity to the special functions of the Prince, whom he represents throughout as the servant of the people. Education was published in 1516, three years after Niccolò Machiavelli’s The Prince; a comparison between the two is worth noting. Machiavelli stated that, to maintain control by political force, it is safer for a Prince to be feared than loved. Erasmus preferred for the Prince to be loved, and strongly suggested a well-rounded education in order to govern justly and benevolently and avoid becoming a source of oppression.

His residence at Leuven, where he lectured at the University, exposed Erasmus to much criticism from those Ascetics, academics and clerics hostile to the principles of literary and religious reform and the loose norms of the Renaissance adherents to which he was devoting his life. In 1517, he supported the foundation at the University, by his friend Hieronymus van Busleyden, of the Collegium Trilingue for the study of Hebrew, Latin, and Greek—after the model of the College of the Three Languages at the University of Alcalá. However, feeling that the lack of sympathy which prevailed at Leuven at that time was actually a form of mental persecution, he sought refuge in Basel, where under the shelter of Swiss hospitality he could express himself freely. Admirers from all quarters of Europe visited him there and he was surrounded by devoted friends, notably developing a lasting association with the great publisher Johann Froben.

The third edition of 1522 was probably used by Tyndale for the first English New Testament (Worms, 1526) and was the basis for the 1550 Robert Stephanus edition used by the translators of the Geneva Bible and King James Version of the English Bible. Erasmus published a fourth edition in 1527 containing parallel columns of Greek, Latin Vulgate and Erasmus's Latin texts. In this edition Erasmus also supplied the Greek text of the last six verses of Revelation (which he had translated from Latin back into Greek in his first edition) from Cardinal Ximenez's Biblia Complutensis. In 1535 Erasmus published the fifth (and final) edition which dropped the Latin Vulgate column but was otherwise similar to the fourth edition. Later versions of the Greek New Testament by others, but based on Erasmus's Greek New Testament, became known as the Textus Receptus.

As a result of his reformatory activities, Erasmus found himself at odds with both the great parties. His last years were embittered by controversies with men toward whom he was sympathetic. Notable among these was Ulrich von Hutten, a brilliant but erratic genius, who had thrown himself into the Lutheran cause and declared that Erasmus, if he had a spark of honesty, would do the same. In his reply in 1523, Spongia adversus aspergines Hutteni, Erasmus displays his skill in semantics. He accuses Hutten of having misinterpreted his utterances about reform and reiterates his determination never to break with the Church.

Twice in the course of the great discussion, he allowed himself to enter the field of doctrinal controversy, a field foreign to both his nature and his previous practice. One of the topics he dealt with was free will, a crucial question. In his De libero arbitrio diatribe sive collatio (1524), he lampoons the Lutheran view on free will. He lays down both sides of the argument impartially. The "Diatribe" did not encourage any definite action; this was its merit to the Erasmians and its fault in the eyes of the Lutherans. In response, Luther wrote his De servo arbitrio (On the Bondage of the Will) (1525), which attacks the "Diatribe" and Erasmus himself, going so far as to claim that Erasmus was not a Christian. Erasmus responded with a lengthy, two-part Hyperaspistes (1526–27). In this controversy Erasmus lets it be seen that he would like to claim more for free will than St. Paul and St. Augustine seem to allow according to Luther's interpretation. For Erasmus the essential point is that humans have the freedom of choice. The conclusions Erasmus reached drew upon a large array of notable authorities, including, from the Patristic period, Origen, John Chrysostom, Ambrose, Jerome, and Augustine, in addition to many leading Scholastic authors, such as Thomas Aquinas and Duns Scotus. The content of Erasmus' works also engaged with later thought on the state of the question, including the perspectives of the via moderna school and of Lorenzo Valla, whose ideas he rejected.

"Free will does not exist", according to Luther in his letter De Servo Arbitrio to Erasmus translated into German by Justus Jonas (1526) in that sin makes human beings completely incapable of bringing themselves to God. Noting Luther's criticism of the Catholic Church, Erasmus described him as "a mighty trumpet of gospel truth" while agreeing, "It is clear that many of the reforms for which Luther calls are urgently needed.” He had great respect for Luther, and Luther spoke with admiration of Erasmus's superior learning. Luther hoped for his cooperation in a work which seemed only the natural outcome of his own. In their early correspondence, Luther expressed boundless admiration for all Erasmus had done in the cause of a sound and reasonable Christianity and urged him to join the Lutheran party. Erasmus declined to commit himself, arguing that to do so would endanger his position as a leader in the movement for pure scholarship which he regarded as his purpose in life. Only as an independent scholar could he hope to influence the reform of religion. When Erasmus hesitated to support him, the straightforward Luther became angered that Erasmus was avoiding the responsibility due either to cowardice or a lack of purpose. However, any hesitancy on the part of Erasmus stemmed, not from lack of courage or conviction, but rather from a concern over the mounting disorder and violence of the reform movement. To Philip Melanchthon in 1524 he wrote:

The Ciceronianus came out in 1528, attacking the style of Latin that was based exclusively and fanatically on Cicero's writings. Etienne Dolet wrote a riposte titled Erasmianus in 1535.

When the city of Basel definitely adopted the Reformation in 1529, Erasmus gave up his residence there and settled in the imperial town of Freiburg im Breisgau.

Erasmus wrote both on ecclesiastic subjects and those of general human interest. By the 1530s, the writings of Erasmus accounted for 10 to 20 percent of all book sales in Europe. He is credited with coining the adage, "In the land of the blind, the one-eyed man is king." With the collaboration of Publio Fausto Andrelini, he formed a Paremiography (collection) of Latin proverbs and adages, commonly titled Adagia. Erasmus is also generally credited with originating the phrase "Pandora's box", arising through an error in his translation of Hesiod's Pandora in which he confused pithos (storage jar) with pyxis (box).

In his catechism (entitled Explanation of the Apostles' Creed) (1533), Erasmus took a stand against Luther's teaching by asserting the unwritten Sacred Tradition as just as valid a source of revelation as the Bible, by enumerating the Deuterocanonical books in the canon of the Bible and by acknowledging seven sacraments. He called "blasphemers" anyone who questioned the perpetual virginity of Mary. However, he supported lay access to the Bible.

Erasmus's last major work, published the year of his death, is the Ecclesiastes or "Gospel Preacher" (Basel, 1536), a massive manual for Preachers of around a thousand pages. Though somewhat unwieldy because Erasmus was unable to edit it properly in his old age, it is in some ways the culmination of all of Erasmus' literary and theological learning, offering prospective Preachers advice on nearly every conceivable aspect of their vocation with extraordinarily abundant reference to classical and biblical sources.

Erasmus's reputation and the interpretations of his work have varied over time. Moderate Catholics recognized him as a leading figure in attempts to reform the Church, while Protestants recognized his initial support for Luther's ideas and the groundwork he laid for the Future Reformation, especially in biblical scholarship. By the 1560s, however, there was a marked change in reception.

His last words, as recorded by his friend Beatus Rhenanus, were apparently "Dear God" (Dutch: Lieve God). A bronze statue of him was erected in the city of his birth in 1622, replacing an earlier work in stone.

In the second (1519) edition, the more familiar term Testamentum was used instead of Instrumentum. This edition was used by Martin Luther in his German translation of the Bible, written for people who could not understand Latin. Together, the first and second editions sold 3,300 copies. By comparison, only 600 copies of the Complutensian Polyglot were ever printed. The first and second edition texts did not include the passage (1 John 5:7–8) that has become known as the Comma Johanneum. Erasmus had been unable to find those verses in any Greek manuscript, but one was supplied to him during production of the third edition. That manuscript is now thought to be a 1520 creation from the Latin Vulgate, which likely got the verses from a fifth-century marginal gloss in a Latin copy of I John. The Roman Catholic Church decreed that the Comma Johanneum was open to dispute (2 June 1927), and it is rarely included in modern scholarly translations.

In his native Rotterdam, the University and Gymnasium Erasmianum have been named in his honor. In 2003, a poll showing that most Rotterdammers believed Erasmus to be the designer of the local "Erasmus Bridge" instigated the founding of the Erasmus House (Rotterdam), and the Erasmus House (Jakarta) dedicated to celebrating Erasmus's legacy. Three moments in Erasmus's life are celebrated annually. On 1 April, the city celebrates the publication of his best-known book The Praise of Folly. On 11 July, the Night of Erasmus celebrates the lasting influence of his work. His birthday is celebrated on 28 October.

The term Sileni—especially when juxtaposed with the character of Alcibiades—can therefore be understood as an evocation of the notion that something on the inside is more expressive of a person's character than what one sees on the outside. For instance, something or someone ugly on the outside can be beautiful on the inside, which is one of the main points of Plato's dialogues featuring Alcibiades and the Symposion, in which Alcibiades also appears.

In support of this, Erasmus states, "Anyone who looks closely at the inward nature and essence will find that nobody is further from true wisdom than those people with their grand titles, learned bonnets, splendid sashes and bejeweled rings, who profess to be wisdom’s peak". Erasmus lists several Sileni and then questions whether Christ is the most noticeable Silenus of them all. The Apostles were Sileni since they were ridiculed by others. He believes that the things which are the least ostentatious can be the most significant, and that the Church constitutes all Christian people —that despite contemporary references to clergy as the whole of the Church, they are merely its servants. He criticizes those that spend the Church’s riches at the people’s expense. The true point of the Church is to help people lead Christian lives. Priests are supposed to be pure, yet when they stray away, no one condemns them. He criticizes the riches of the popes, believing that it would be better for the Gospel to be most important.