Thomas was the eldest son of Edmund Crouchback and thus a grandson of Henry III of England. From his father he inherited the earldoms of Lancaster, Leicester, and Derby. By his marriage to Alice de Lacy, daughter of Henry de Lacy, he became earl of Lincoln and Salibury upon the death of his father-in-law in 1311.
Lancaster was one of the Lords Ordainers who demanded the banishment of Piers Gaveston and the establishment of a baronial oligarchy. His private army helped separate the king and Gaveston, and Lancaster was one of the 'judges' who convicted Gaveston and saw him executed.
After the disaster at Battle of Bannockburn in 1314, Edward submitted to Lancaster, who in effect became ruler of England. He attempted to govern for the next four years, but was unable to keep order or prevent the Scots from raiding and retaking territory in the North. In 1318 a new faction of barons arose, and Lancaster was deposed from office.
The new leadership, eventually headed by the Despensers, proved no more popular with the baronage, and in 1321 Lancaster was again at the head of a rebellion. This time, however, he was defeated at the Battle of Boroughbridge, and afterwards convicted of treason and executed.