The Holly King is one aspect of the Horned God or Green Man, sometimes called Cernunnos. The Holly King rules the year from the summer solstice to the winter solstice, when he is killed and replaced by the Oak King, who then rules from midwinter to midsummer. In some traditions the two kings are twin brothers that constantly fight over the “wheel of the year,” with one killing the other, only to be later replaced by his magically resurrected brother. Many neo-pagans have adopted this legend.
Of course, this story reflects the nature worshipping aspects of Celtic religion as each king in turn represents different times of the year.
In some traditions, the Oak King defeats the Holly King and sacrifices him at midwinter, with Yule being the Holly King’s farewell.
The story of Sir Gawain and the Green Knight reflects this tradition in the Arthurian cycle. The Green Knight shows up at Camelot on New Year’s Day. He is dressed all in green, wearing holly in his hair and bearing an axe. The Green Knight challenges any of Arthur’s knights to strike him one blow. In return, the Green Knight will strike the same blow in one year’s time. Gawain, Arthur’s youngest knight, takes up the challenge and beheads the Green Knight with a single stroke. The Green Knight calmly picks up his head and tells Gawain to meet him in a year. If the Green Knight and Gawain story were strictly following the legend, they would meet again in six months, not a year.
According to Sir James Frazer in his “The Golden Bough”, the Holly King and Oak King also represent two sides of the divine monarchy archetype, in which the king is actually a god or aspect of a god on earth. As he grows old and weak, he will be killed and replaced by a younger and more powerful divine king.
In many societies this sacrifice was very real and took place annually, at either midwinter or midsummer. Later, ritual combat took the place of actual combat, without the actual killing of either of the “kings.” Later still, the combat aspects were completely dropped, and the two parts were acted out by men wearing masks to represent either of the two kings.
Some current Christmas traditions have descended from the Holly King legend, like displaying holly sprigs and mistletoe (representing the oak) at the holiday. Also, in some representations the Holly King appears as a kind of woodland Father Christmas or Santa Clause, driving a sleigh pulled by eight stags, dressed in long robes with a crown of holly on his hair.
Besserman, Lawrence. “The Idea of the Green Knight.” ELH, Vol. 53, No. 2. (Summer, 1986), pp. 219-239. The Johns Hopkins University Press
Frazer, James George, (1974) “The Golden Bough: A Study in Magic and Religion” Volume 6. MacMillian Publishing.
Graves, Robert, (1966) “The White Goddess: A Historical Grammar of Poetic Myth.” Farrar, Straus and Giroux