Marshall had a long and varied stage career, appearing with such notables as Sir Nigel Playfair, Sir Gerald du Maurier, Noël Coward, Gertrude Lawrence, Edna Best (his second wife), Cathleen Nesbitt, Mabel Terry-Lewis, Marie Löhr, Madge Titheradge and Edmund Gwenn (his Future film and radio co-star). While his stage debut is usually listed as The Adventure of Lady Ursula (1911), some sources place it in 1909. Furthermore, Marshall remembered playing a footman alongside Eric Blore in Robert Courtneidge's The Arcadians; his mention of Blore would add an appearance in November 1910. In 1913, he made his London debut in the role of Tommy in Brewster's Millions. Actor-manager Cyril Maude was so impressed with his performance that he recruited Marshall for his US and Canadian tour of Grumpy. When war was declared, the company returned to London and the 24-year-old enlisted.

Marshall was married five times and divorced three. In 1914, he appeared with Mollie Maitland (whose real name was Hilda Lloyd Bosley) in The Headmaster; the following year, they were married. Five years later, he first appeared with Edna Best, who would become his most frequent stage co-star; they also made three films together (The Calendar, Michael and Mary and The Faithful Heart). Marshall and Best were married in November 1928, following their respective divorces (they had been cohabiting for the previous three years). In 1931, Best broke a lucrative contract with MGM and walked off the filming of The Phantom of Paris with John Gilbert in order to be with Marshall in New York, where he was performing in a play. In response to a press inquiry, he said: "I'm sorry if Hollywood is annoyed, but Edna and I happen to be in love with each other and we want to be together."

Marshall would recall his time on the Western Front: "I knew terrific boredom. There was no drama lying in the trenches 10 months. I must have felt fear, but I don't remember it. I was too numb to recall any enterprise on my part." On 9 April 1917 he was shot in the left knee by a sniper at the Second Battle of Arras in France. After a succession of operations, doctors were forced to amputate his left leg. Marshall remained hospitalised for thirteen months. He later recalled in private that after his injury, he had initially over-dramatised his loss and was wrapped up in self-pity and bitterness. Before long, however, he decided he wanted to return to the theatre and learned how to walk well with a prosthetic leg in order to do so. While he was recovering at St. Thomas' in London, King George V visited the hospital. When asked to pick which of the actor's legs he thought was artificial, the king chose the wrong one. Throughout his career, Marshall largely managed to hide the fact that he had a prosthetic limb, although it was occasionally reported in the press.

Following the Armistice, Marshall joined Nigel Playfair's repertory troupe, appearing in Make Believe (December 1918), The Younger Generation (1919) and Abraham Lincoln (1919). In 1920, he made his first known appearance opposite Edna Best in Brown Sugar. He also appeared in John Ferguson and the Shakespearean plays, The Merchant of Venice and As You Like It. Marshall recalled, "Jacques in As You Like It has given me more pleasure than any part I have played". The following year, he toured North America with Australian star Marie Löhr and starred in A Safety Match in London. By 1922, Marshall was making regular appearances on both sides of the Atlantic, debuting on Broadway in The Voice From the Minaret and starring in Coward's The Young Idea (with then-wife Maitland) and The Queen Was in the Parlour. Among his other successes were Aren't We All? (1923), The Pelican (1924–25), Lavender Ladies (1925), Interference (1927–28), S.O.S. (1928) and Tomorrow and Tomorrow (1931). His greatest hits with Edna Best were the aforementioned Brown Sugar, The Charming People (1925–26), The High Road (1928–29), Michael and Mary (1930), The Swan (1930) and There's Always Juliet (1931–32).

In 1927, Marshall debuted onscreen opposite Pauline Frederick in the British silent film Mumsie. He made his first Hollywood appearance as the husband of Jeanne Eagels's character in The Letter two years later. After The Letter, in Britain once again, he notably starred in Alfred Hitchcock's Murder! (1930). The following year, he returned to Hollywood to make Secrets of a Secretary for Paramount Studios. After a few additional British films in the early 1930s, he primarily made films in the United States for the remainder of his life. As a Hollywood leading man, the suave, gentlemanly actor played romantic roles opposite such stars as Claudette Colbert, Marlene Dietrich, Greta Garbo, Barbara Stanwyck, Katharine Hepburn, Joan Crawford and Bette Davis throughout the 1930s and into the 1940s.

In the early 1930s, Marshall was commonly rumoured within Hollywood social circles to have had affairs with both his Trouble in Paradise co-stars, Kay Francis and Miriam Hopkins. In January 1934, Marshall, while still married to Best, began a serious affair with Actress Gloria Swanson, who recounted their relationship in her memoirs, Swanson on Swanson (1980). She described Marshall at the time of their first meeting as "a handsome man in his early forties with a gentle face and soft brown eyes", who had "one of the most perfect musical voices I had ever heard". Swanson also wrote that the actor was "sweet beyond belief" and "a nice man", who "utterly charmed" her and her children. He constantly wrote her love notes, and when she was out of town, he sent her romantic telegrams almost hourly. (Many of these personal documents now reside at the University of Texas at Austin's Harry Ransom Center archives, as part of the Gloria Swanson Papers.) Newspapers and film fan magazines widely discussed his affair with Swanson at the time, which he made little attempt to keep secret.

During a return trip to London in late November 1932, Marshall and a pregnant Best gave an interview in which they stated their intention to briefly return to Hollywood the following summer. They would bring a nanny to help look after their daughter. At some point, Best and young Sarah returned to London while Marshall received more film offers. They continued making trips to see each other. In late 1933, Actress Phyllis Barry had tea with Marshall and Claudette Colbert after they returned from Hawaii, where they had been filming Four Frightened People. She remembered that Marshall "insisted on my talking all the time because he said I sounded just like his wife". By the time Marshall was filming Riptide in early 1934, he was reportedly drinking heavily due to his problems with Best and increased phantom pain. (Director Goulding and co-star Norma Shearer successfully convinced him to curb his consumption of alcohol.) Not long after, Goulding would introduce him to Gloria Swanson.

Besides his early romantic roles, Marshall was especially associated with the onscreen works of British author W. Somerset Maugham. In addition to performances in both filmed versions of Maugham's The Letter, Marshall also starred in adaptions of The Painted Veil (1934), The Moon and Sixpence (1942) and The Razor's Edge (1946). In the latter two, he portrayed the author himself, first as Maugham stand-in Geoffrey Wolfe and later as Maugham (formally), serving as both a narrator and a character within the film.

Marshall graduated from St. Mary's College in Old Harlow, Essex and worked for a time as an accounting clerk. After being sacked for the slow speed of his calculations, he took a job as an assistant Business manager of a theatre troupe run by a friend of his father's. He later had a series of different backstage jobs at various theatres and acting companies. When a troupe he worked for reformed, he was laid off. He then tried his hand at acting. In a 1935 interview, he claimed that he only became an actor out of necessity because he did not know how to do anything else. To another reporter, he recollected how he had initially vowed never to go on the stage.

In November 1936, Swanson left him once she accepted that he would not divorce Edna Best to marry her. Although insisting they were "madly in love," she believed that he would not demand a divorce because of his typically docile nature, reluctance to deliberately hurt people, and guilt over his separation from his young daughter. "He would always turn to alcohol rather than face a painful scene," she remembered. Despite an emotional parting, near the end of her life Swanson, who was married six times, wrote: "I was never so convincingly and thoroughly loved as I was by Herbert Marshall."

In 1940, after a long separation from her husband and wanting to marry someone else, Best divorced Marshall on grounds of desertion (he lived in Hollywood, while she lived in Britain). She remarried almost immediately. Twenty days later, he married Actress and model Elizabeth Roberta "Lee" Russell, a sister of film star, Rosalind Russell. Two years prior to their marriage, Russell's recently divorced ex-husband, Songwriter Eddy Brandt, initiated an alienation of affection suit for $250,000 against Marshall, whom he accused of stealing his wife. Brandt later told the press that he and the actor settled out of court for $10,000. Marshall publicly denied this claim. In 1947, Russell divorced him in Mexico. They parted on amiable terms. Instead of explaining the reasons for her divorce, she told the press at the time: "I will never say anything against Bart. He is one of the most charming people I have ever known."

In 1941, he starred as Bette Davis's maltreated, principled husband, Horace Giddens, in The Little Foxes, which received nine Academy Award nominations including one for Best Picture. The film's review in Variety noted, "Marshall turns in one of his top performances in the exacting portrayal of a suffering, dying man." Over the course of the 1940s, he began to move into character roles, including parts in such classics as Foreign Correspondent (1940), The Enchanted Cottage (1945), Duel in the Sun (1946) and The Secret Garden (1949). Also in the immediate post-war years, he appeared in the film noirs, Crack-Up (1946), Ivy (1947), High Wall (1947), The Underworld Story (1950) and Angel Face (1953). During the 1950s and 1960s, he periodically performed in period films, including The Black Shield of Falworth (1954) with Janet Leigh and Tony Curtis, The Virgin Queen (1955) with Bette Davis, science-fiction films, foremost The Fly (1958) with Vincent Price, and crime thrillers, like Midnight Lace (1960) with Doris Day and Rex Harrison.

From 1944 to 1952, Marshall starred in his own radio series, The Man Called 'X'. Often praised for the quality of his voice, he made numerous radio guest appearances and hosted several shows. He performed on television as well. The actor, known for his charm, married five times and periodically appeared in gossip columns because of his sometimes turbulent private life. During the Second World War, he worked on the rehabilitation of injured troops, especially aiding amputees like himself. Marshall received a star on the Hollywood Walk of Fame in 1960.

Using his own money for travel, Marshall visited many military hospitals during the war. In particular, he focused on encouraging Soldiers with amputations to keep a positive attitude and not to think of themselves as handicapped or limited. Despite his usual reluctance to discuss his own injury, he talked freely about his personal experiences in order to give these amputees tips on how to use and adjust to their new artificial limbs. Although mostly kept private, a 1945 article in Motion Picture Magazine reported, against Marshall's wishes, on his work at military hospitals. The author, Patty De Roulf, insisted that his story needed to be told to help injured veterans and their families and to show that "Marshall is doing one of the finest war jobs any human being can do." She interviewed one young officer, who recalled:

Beginning in 1950, Marshall performed periodically on television, including two appearances on Alfred Hitchcock Presents and several adaptations of plays and films, such as The Philadelphia Story and Now, Voyager. In the 1950s, he hosted a series of half-hour dramatic stories entitled The Unexpected (a.k.a. Times Square Playhouse). He appeared as the "mystery guest" on an episode of the popular game show What's My Line? in November 1954. His most notable guest role in the 1960s was as Father Anthony on 77 Sunset Strip.

With the increasing public demand for grittier films after the Second World War, the remaining members of the Hollywood British "colony" began to part ways, with some returning to Britain while others stayed in Hollywood. Marshall, like many of his contemporaries who stayed in Hollywood, began to receive far fewer acting offers and, especially toward the end of his life, had to take whatever he could get due to financial reasons. In May 1951, while in the hospital recuperating from corrective surgery, he suffered a "pulmonary embolism around his heart". After NBC aired three episodes of The Man Called 'X' that were previously transcribed, Marshall's friends Van Heflin, John Lund and Joseph Cotten filled in (one episode each) until Marshall's return in June 1951.

Marshall had a daughter, Sarah, by Edna Best, and another daughter, Ann, by Lee Russell. Sarah Marshall followed her parents and grandparents into the acting profession, appearing in many of the most popular television shows of the 1960s, including Star Trek, The Twilight Zone, Perry Mason, F Troop and Daniel Boone. Herbert and Sarah Marshall acted together in a television version of J. B. Priestley's play, An Inspector Calls, in 1951. His younger daughter, Ann Marshall (often called "Annie"), worked for many years as Jack Nicholson's personal assistant. He also had at least four step-children, two from his marriage to Best and two from his marriage to Mallory. His grandson, Timothy M. Bourne, Sarah Marshall's only child, is an independent film Producer. Bourne was the executive Producer of the Academy Award-winning film The Blind Side (2009).

Marshall appeared in his last significant film role in The Caretakers (1963) with Joan Crawford, who was happy to act with him again 22 years after they made When Ladies Meet together. Noting his poor health and heavy drinking, she worked with the film's Director to minimise the time Marshall had to be on the set. In late 1965, after his final, brief film appearance in the thriller The Third Day, Marshall was admitted to the Motion Picture Relief Fund Hospital for severe depression. Eight days after his release, he died on 22 January 1966 in Beverly Hills, California, of heart failure at the age of 75. He was interred at Chapel of the Pines Crematory in Los Angeles.