Holm died peacefully on Friday morning in a hospital, surrounded by his family and carer, his agent Alex Irwin said in a statement.

His illness was Parkinson's-related.

"His sparkling wit always accompanied a mischievous twinkle in his eye," Irwin said.

"Charming, kind and ferociously talented, we will miss him hugely."

Holm appeared in scores of movies big and small, from costume dramas to fantasy epics.

A generation of movie-goers knows him as Bilbo Baggins in The Lord of the Rings and The Hobbit trilogies.

He won a British Academy Film Award and gained a supporting-actor Oscar nomination for portraying pioneering athletics coach Sam Mussabini in the hit 1982 film Chariots of Fire.

His other movie roles included Father Cornelius in The Fifth Element, android Ash in Alien, a smooth-talking lawyer in The Sweet Hereafter, Napoleon Bonaparte in Time Bandits, writer Lewis Carroll in Dreamchild and a royal physician in The Madness of King George.

He was also a charismatic theatre actor who won a Tony Award for best featured actor as Lenny in Harold Pinter's play The Homecoming in 1967.

He was a longtime member of the Royal Shakespeare Company, though a bout of debilitating stage fright that struck during a production of The Iceman Cometh in 1976 kept him off the stage for many years.

"I think it happens quite often to actors," Holm told the Associated Press in 1998.

"They lose their nerve. They may think it's a crazy way to make a living, or whatever. I was fortunately gainfully employed in the other media. I could have frozen in front of a camera, and I would have had to become a chimney sweep or something."

He returned to live performance and won a 1998 Laurence Olivier Award for best actor for his performance in the title role of King Lear at the National Theatre.

Holm was knighted in 1998 for his services to drama.

Australian Associated Press