Lynch was born August 1, 1963, in Boulder, Colorado. He was raised in Denver. In 1996, he received critical acclaim for his role as Marge Gunderson's simple husband Norm in the movie Fargo.
In the fall of 2003, he starred in the CBS series The Brotherhood of Poland, New Hampshire, with Randy Quaid, Chris Penn, Mare Winningham, Elizabeth McGovern, and Ann Cusack. The show was cancelled after only a few episodes. He also had a recurring role in the HBO show Carnivàle, playing escaped convict Varlyn Stroud. Lynch appeared as a district attorney in the CBS series Close to Home and as NASA official Bob Gilruth in the HBO mini-series From the Earth to the Moon. Lynch appeared in the thriller Gothika (2003) and as suspect Arthur Leigh Allen in Zodiac (2007).
He was also in Fox's police drama series K-Ville as New Orleans Police Captain James Embry and had a recurring character arc on FX spy drama The Americans.
Lynch appears as "Col. Drummond" in the Sundance Film Festival drama Camp X-Ray starring Kristen Stewart and Peyman Moaadi. The film is scheduled for release by IFC Filmsin late 2014.
- Lynch has twice played a murderer on a circus-themed series. First on Carnivàle and then on AHS:Freak Show.
- In Freak Show, Lynch plays Twisty the clown, inspired by real-life killer clown John Wayne Gacy. In Hotel, he plays the ghost of John Wayne Gacy.
- He reprises his role as Twisty in Cult.