Ian Holm Cuthbert was born on 12 September 1931 in Goodmayes, Essex, to Scottish parents, James Cuthbert and his wife Jean (née Holm). His father was a psychiatrist who worked as the superintendent of the West Ham Corporation Mental Hospital and was one of the pioneers of electric shock therapy; his mother was a nurse. He had an older brother who died when Ian was 12 years old. Holm was educated at the independent Chigwell School in Essex. His parents retired to Mortehoe in Devon and then to Worthing, where he joined an amateur dramatic society.
A chance encounter with Henry Baynton, a well-known provincial Shakespearean actor, helped Holm train for admission to the Royal Academy of Dramatic Art, where he secured a place from 1950. His studies were interrupted a year later when he was called up for National Service in the British Army, during which he was posted to Klagenfurt, Austria, and attained the rank of Lance Corporal. They were interrupted a second time when he volunteered to go on an acting tour of the United States in 1952. Holm graduated from the Royal Academy of Dramatic Art in 1953.
He made his stage debut in 1954, at Stratford-upon-Avon, playing a spear carrier in a staging of Othello. Two years later, he made his London stage debut in Love Affair.