He has been a distinctive character actor in numerous films since then, often showing up well in roles like the rich, sleazy New Orleans blackmailer Slade opposite Steve McQueen and Karl Malden in 1965's The Cincinnati Kid or the gruff boss Agent Zed in Men in Black.
The part of lawyer George Hanson in the Peter Fonda-Dennis Hopper road movie Easy Rider was written for Torn by Terry Southern (who was a close friend) but according to Southern's biographer Lee Hill, Torn withdrew from the project after he and co-director Dennis Hopper got into a bitter argument in a New York restaurant, ending with Dennis Hopper pulling a knife on Torn. As a result, Torn had to be replaced by Jack Nicholson, whose appearance in the film catapulted him to stardom.
In 1972 he won rave reviews for his portrayal of a country & western singer in the cult film Payday. In 1976 he starred in the cult classic science fiction movie The Man Who Fell to Earth. He received what many felt was a long-overdue Academy Award nomination as Best Supporting Actor for his role in the 1983 film Cross Creek.
In 1988, he made an unsuccessful venture into directing with the offbeat comedy The Telephone, starring Whoopi Goldberg. The screenplay was written by Terry Southern and Harry Nilsson and the film was produced by their company Hawkeye. The story, which focussed on an unhinged, out-of-work actor, had been written with Robin Williams in mind. After he turned it down, Goldberg expressed a strong interest, but when production began Torn reportedly had to contend with Goldberg constantly digressing and improvising, and he had to plead with her to perform takes that stuck to the script. Goldberg was backed by the studio, who also allowed her to replace Torn's chosen DP, veteran cinematographer John Alonzo, with her then husband. As a result of the power struggle, Torn, Southern and Nilsson cut their own version of the film, using the takes that adhered to the script, and this was screened at the Sundance Film Festival, but the studio put together a rival version using other takes and it was poorly reviewed when it premiered in January 1988. In 1990, he played ultra-hawkish Colonel Fargo in By Dawn's Early Light, which despite a modest budget is replete with major name actors from the era when it was filmed. In 1993, Torn played the OCP CEO in the science fiction film, Robocop 3.
For his role as talk show producer and TV veteran Artie in The Larry Sanders Show, Torn received six consecutive Emmy award nominations as Best Supporting Actor in a Comedy Series and won the award once, in 1996. He has since appeared in many comedic roles in films such as Dodgeball: A True Underdog Story, Freddy Got Fingered, Canadian Bacon and Rolling Kansas, as well as dramatic roles in films such as The Insider and Marie Antoinette. Torn is also known for his voice work, and has done voice-overs for many animated films, the most notable being Hercules. He lent his voice to the Jerry Seinfeld film Bee Movie. In 2007 and 2008 Torn made five guest appearances on the Emmy-award winning NBC comedy 30 Rock as the fictional head of the network, Don Geiss. He will next be seen in a starring role in Turn the River costarring Famke Janssen.
In January 2004, Torn was arrested for drunk driving after colliding with a taxi in New York City. Video of his arrest in which he curses at officers and angrily refuses a breathalyzer test was aired on television news outlets. In October 2004, a jury acquitted Torn of any wrongdoing. In December 2006, Torn was again arrested for drunk driving in North Salem, New York after colliding with a tractor trailer. In April 2007, Torn pled guilty and agreed to have his license suspended for 90 days and pay a $380 fine.
In 1999, Torn filed a defamation lawsuit against Dennis Hopper over a story Hopper told on The Tonight Show with Jay Leno. Hopper claimed that Torn pulled a knife on him during pre-production of the film Easy Rider. According to Hopper, Torn was originally cast in the film but was replaced with Jack Nicholson after the incident. According to Torn's suit, it was actually Hopper who pulled the knife on him. A judge ruled in Torn's favor and Hopper was ordered to pay $475,000 in damages. Hopper then appealed but the judge again ruled in Torn's favor and Hopper was required to pay another $475,000 in punitive damages.