She began acting professionally at 3 years of age with a national commercial for Shake 'N' Bake. She was then cast in The Prophet's Game. In 2000, Momsen played the role of Cindy Lou Who in How the Grinch Stole Christmas. Two years later she was cast in the motion picture: Hansel & Gretel, in which she played Gretel.
Momsen's career came to a halt for over three years until she received the lead role in the never-aired The WB series Misconceptions. In 2002, Momsen recorded "Rudolph the Red-Nosed Reindeer" and "One Small Voice" featuring Myra and Camille Winbush for School's Out! Christmas. Momsen appeared in the 2006 film Saving Shiloh and also the 2007 Walt Disney Pictures film Underdog, as Molly. She auditioned for the title role in Hannah Montana, and was in the top three, but the role was instead awarded to Miley Cyrus. As of 2007 she plays the character of Jenny Humphrey in The CW television series Gossip Girl, which is based on the book series by Cecily von Ziegesar. Momsen is due to be absent for most of season 4 due to a big storyline for the character in the season 3 finale. Creative differences have been cited for this.
In June 2008, at the age of fourteen, Momsen signed to IMG Models.
Taylor was the face of British fashion chain New Look, for their Spring/Summer 2010 Collection. After weeks of speculation of who was the face of Madonna's new fashion line "Material Girl" it was revealed on July 15, 2010 that Taylor was the face and inspiration fashion line exclusively sold at Macy's. It was announced on July 22, 2010 that Taylor would be the model for John Galliano's as-yet-unnamed new women’s fragrance, which launches this Autumn. This is her biggest modeling assignment yet.
In March 2009, Momsen stated in an interview with OK! Magazine that her band, The Pretty Reckless, had recently signed a deal with Interscope Records. She also mentioned that she writes all the songs, sings, and plays guitar on the album. Momsen has also made it onto the 2009 People Magazine 100 most beautiful list at number 76.
She is currently touring with her band, The Pretty Reckless, on The Vans Warped Tour.