Was promoted to the position of Deputy Director of MI5 in 1953 and then became the Director in 1956.

In 1961, KGB defector Anatoli Golitsyn described an elaborate spy ring within Britain, naming Guy Burgess and Donald MacLean as members of the "Ring of Five." As MI5 began to close in on Philby, who it was thought, was another member of the ring, he was tipped off about his impending arrest and fled to Moscow in 1963. Hollis was one of only five senior-level MI5 officer who knew that Philby was to be arrested and it is believed that he tipped off his friend.

In 1963, failed to provide British Prime Minister Harold MacMillan with information concerning Russian spy Yevgeny Ivanov, who was involved in the Profumo scandal that rocked England and eventually forced MacMillan to resign his position. In 1964, approved of the deal in which Anthony Blunt, the fourth member of the Ring of Five, received immunity from prosecution. Was knighted by Queen Elizabeth and resigned in 1965.

Was the subject of intense speculation based on numerous close, personal friendships and contacts with known and exposed spies as well as his less than stellar tenure and the Director-General. Hollis was referred to quietly as Mr. Inertia because of his lethargy in taking action.