Lilly's acting career began when she was discovered by a Ford Modeling Agency agent while walking the streets of Kelowna, British Columbia. She took the agent's business card but did not immediately pursue acting. She eventually called and the agency landed her several roles in commercials and non-speaking parts in the TV shows Smallville and Kingdom Hospital.
Lilly was encouraged to audition for ABC's Lost by a friend and she did not expect to get cast. As the secrecy campaign prevented the auditioning actors from accessing the full script, forcing them to read short scenes and only know the basic premise of people surviving a plane crash on a tropical island – which reminded Lilly of The Blue Lagoon – she thought Lost would "at best be a mediocre TV show". Around 75 women auditioned for the part of Kate Austen. Writer and co-creator Damon Lindelof said that he and executive producer and co-creator J. J. Abrams "were fast-forwarding through a tape, and he saw her and said, 'That's the girl.'" The character almost had to be recast, as Lilly had trouble acquiring a work visa to enter the United States. Her application was finally accepted after nearly 20 tries and she arrived in Hawaii for filming one day late.
Lost ran for six seasons from 2004 to 2010. It was one of the top shows on ABC's primetime schedule during its run, winning one Golden Globe Award and ten Primetime Emmy Awards, including Outstanding Drama Series in 2005, and was ranked the top-rated TV show of the decade by IMDb. Lilly appeared in 108 of the show's 121 episodes, and her character, Kate Austen, was the show's female lead. Entertainment Weekly voted Lilly one of its "Breakout Stars of 2004." In 2006, she was nominated for a Golden Globe Award for Best Actress – Television Series Drama. Robert Bianco of USA Today praised Lilly's performance in the episode "Eggtown", saying that it was almost worthy of a Primetime Emmy Award for Outstanding Lead Actress in a Drama Series nomination. In 2007, Lilly's portrayal was voted #1 Sexiest Woman on Television by TV Guide and made FHM's Top Sexiest. Evangeline was voted one of People Magazine's '50 Most Beautiful People'. After shooting the final episode of Lost, Lilly said she was considering taking a break from acting to focus on her charity and humanitarian efforts. She told Vulture, "I consider acting a day job — it's not my dream; it's not my be-all, end-all." She says she uses her high-profile roles to further her humanitarian efforts, not to achieve stardom.
In 2008, Lilly appeared in the Academy Award-winning film The Hurt Locker. She and the rest of the cast won the Gotham Independent Film Award for Best Ensemble Cast and the Washington D.C. Area Film Critics Association Award for Best Ensemble. Lilly followed this role with a leading part in psychological thriller film Afterwards. In 2010, Lilly stated her intention to focus on children's book writing and on feature film roles.
On May 11, 2010, Lilly announced on The View that she places writing and being a mother as top priorities, but she likes acting as a day job and she will continue acting when possible. Lilly took short retirement and was not in contact with Hollywood at all. In 2011, she appeared as Bailey Tallet in Real Steel. Despite having turned down a number of film offers, she traveled to Los Angeles to get the part after director Shawn Levy sent her the script. Levy said: "She's magnificent to look at, she's soulful, and she's sexy. I needed someone who you believed had grown up in a man's world. Bailey needed to have a strength and a toughness that was not at the expense of her being womanly."
In 2012, Lilly was cast as the Mirkwood elf Tauriel in Peter Jackson's three-part adaptation of J. R. R. Tolkien's The Hobbit. The character, which does not appear in the original book by Tolkien, was created by Peter Jackson and Fran Walsh as the head of the Elven guard who wields a bow and two daggers as weapons. Lilly, who had been a fan of Tolkien's books since she was 13, underwent training for swordplay and archery, as well as in the Elvish language for the role. In 2015, Lilly played Hope van Dyne / Wasp in the superhero film Ant-Man, and later reprised her role in the sequel, Ant-Man and the Wasp (2018), Marvel's first movie to feature a female hero in the title. Lilly will return alongside Paul Rudd in Avengers: Endgame (2019).
She will star alongside Armie Hammer and Gary Oldman in Dreamland, directed by Nicholas Jarecki.
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