HSV was created in 1987 as a joint venture between Holden and TWR - an operation owned by Scottish racing car driver and entrepreneur Tom Walkinshaw. HSV effectively replaced the Holden Dealer Team (HDT) special vehicles operation run by Peter Brock, after Holden severed its ties with HDT in February 1987 following the "Energy Polarizer" and "HDT Director" controversies. With the more recent demise of TWR's global companies, HSV still remains a partnership between Holden and Walkinshaw, the joint ownership company being Premoso Pty Ltd.

The first car produced by HSV was the SS Group A SV in 1988 (based on the VL Commodore and not to be confused with the HDT's similarly named VL SS Group A). It had a distinctive body kit with a large rear wing (earning it the nicknames "The Batmobile" and the "Plastic Pig") and was powered by a modified version of the Holden 5.0 litre V8, which had dual throttle body electronic fuel injection and was rated at 180 kW in road car form. It was built as a touring car homologation package for Group A racing and in racing form, managed to win the 1990 Bathurst 1000 race in the hands of Allan Grice and Win Percy for HSV's racing arm, the Holden Racing Team.

Over the years HSV have built an array of modified vehicles, most of which have been based on the Commodore and powered by either Holden or Chevrolet sourced V8s. Notable HSV models include the SS Group A (both the 1988 VL and 1990 VN Commodore versions), the SV 5000, Clubsport, Senator, GTS, GTS-R, XU6 and the Grange. The 2006 HSV GTS is the most powerful production vehicle in Australia, producing 307 kW from its 6.0-litre Chevrolet V8, and can produce claimed 0-100 km/h times of 4.9 seconds, and l3.2 second 0-400 metre sprints.

Since the year 2000, HSV's products have progressively found their way into export markets in limited numbers, most notably to the United Kingdom.

Also, recently in 2007, HSV celebrated it's 20th Anniversary with the limited release of 100 Clubsport R8 20th Anniversary Edition.