During his subsequent campaign for lieutenant governor, he made a comment to a state senator from Yazoo City. The man was insulted, and during the ensuing skirmish the man broke his cane over Bilbo's head. But Bilbo's campaign was successful, and he served as lieutenant governor from 1912 to 1916. One of his first acts as lieutenant governor was to remove the resolution calling him "unfit to sit with honest men" from the records.
Afterwards, Bilbo once again caused controversy by hiding in a barn to avoid a subpoena in a case involving his friend, then-governor Lee M. Russell, who had served as Bilbo's lieutenant governor, and Russell's former secretary, who accused Russell of breach of promise and of seducing and impregnating her; as a result, she underwent an abortion that left her unable to have children. Bilbo had been sent to try to convince this woman not to sue Russell. He was unsuccessful, but the woman was also unsuccessful in her suit against Russell. Judge Edwin R. Holmes sentenced him to 30 days in prison for "contempt of court" and Bilbo actually served 10 days behind bars, declaring to the crowd outside his cell that he would run for governor again in 1923, but lost. However, in 1927 he was elected Governor again after winning the Democratic primary in a runoff election over Governor Dennis Murphree. Bilbo criticized Governor Murphree for calling out the National Guard to prevent a lynching in Jackson, declaring that no black person was worthy of protection by the Guard.
His second term was filled with controversy involving his plan to move the University of Mississippi from Oxford to Jackson. That idea was defeated, but Bilbo's ideas concerning the universities would later call Mississippi's credibility into question. During the 1928 presidential election, Bilbo helped Al Smith carry the state despite an overwhelming anti-Catholic sentiment, by claiming that Herbert Hoover had met with a black member of the Republican National Committee and danced with her. In a speech in Memphis on October 17, Bilbo asserted that during a visit to Mississippi in 1927, "Hoover insisted that his train be routed through Mount Bayou... in order that he might visit Mrs. Mary Booze, a negress, socially," and added, "Mary Booze is as black as the ace of spades. And Hoover danced with her. Though widely reported, the odd story did not prevent Hoover from being elected President of the United States the following month.
As a result, recognition of degrees from all four of Mississippi's state colleges (Mississippi State Teachers College, now the University of Southern Mississippi was the other) was suspended by the Association of American Universities and the Southern Association of College and Secondary Schools. The American Medical Association voted to cancel the accreditation of the state's college of medicine. The Association of American University Professors (AAUP), meeting in Cleveland, passed a resolution that the remaining Mississippi professors would "be regarded as retired members of the profession," after finding that the dismissals of employees had been made "for political considerations and without concern for the welfare of the students". During the crisis, Bilbo was burned in effigy by students at Ole Miss, but was unconcerned about the state's image. He made national headlines by giving an interview while taking a bath, "sitting in a tub of hot water, soap in one hand, washrag in the other, and a cigar in his mouth". The lack of recognition continued until "satisfactory evidence of improved conditions" was provided to the AAUP and the other institutions in 1932.
In his final year of office, Governor Bilbo and the legislature were at a stalemate. He refused to sign the tax bills and the legislature refused to approve his bills. At the end of his term, the State of Mississippi was broke. The state treasury had only $1,326.57 in its coffers, and the state was $11,500,000 in debt. Bilbo, whose actions had halted USDA funding of the agricultural school at Mississippi state, was hired as a "consultant on public relations" for the U.S. Department of Agriculture for a short time, clipping newspaper articles for a high salary, a reward from Senator Pat Harrison for Bilbo's campaign support. Pundits dubbed him the "Pastemaster General". Soon, Bilbo made plans to run for the U.S. Senate seat held by Hubert Stephens.
In 1934, Bilbo defeated Stephens to win a seat in the United States Senate. As part of his oratory, he came out against "farmer murderers", "poor-folks haters", "shooters of widows and orphans", "international well-poisoners", "charity hospital destroyers", "spitters on our heroic veterans", "rich enemies of our public schools", "private bankers 'who ought to come out in the open and let folks see what they're doing'", "European debt cancelers", "unemployment makers", pacifists, Communists, munitions manufacturers, and "skunks who steal Gideon Bibles from hotel rooms".
Once in Washington, Bilbo became involved in a feud with Pat Harrison, the senior senator from the state. The feud started when Harrison nominated Edwin R. Holmes for the Fifth Circuit Court of Appeals. Bilbo despised Holmes, apparently carrying lots of leftover animus from the contempt citation, and spoke against him for five hours; he was the only senator to vote against Holmes' confirmation. Harrison lost his bid to become Senate Majority Leader in 1937 by the margin of one vote. Bilbo had gotten his revenge by voting against his fellow Mississippian.
In the Senate, Bilbo was a supporter of Franklin Roosevelt's New Deal. Bilbo caused controversy in the Senate due to his outspoken support of segregation and white supremacy. Attracted by the ideas of Black separatists like Marcus Garvey, Bilbo proposed an amendment to the federal work-relief bill on June 6, 1938, proposing to deport 12 million black Americans to Liberia at federal expense to relieve unemployment. He took the time to write a book titled Take Your Choice, Separation or Mongrelization, advocating the idea. Garvey praised him in return, saying that Bilbo had "done wonderfully well for the Negro".
Bilbo was assigned to what was considered the least important Senate committee, the District of Columbia Committee, as a way to try to limit his power. He used this role to advance his white supremacist views. Bilbo was against giving any vote to district residents, especially as the district's black population continued to increase. He chaired the committee, 1945-47. He also served on the Pensions Committee, chairing it 1942-45.
While Senator Bilbo revealed his membership to the Ku Klux Klan on the radio program Meet the Press. During the interview he stated, “No man can leave the Klan. He takes an oath not to do that. Once a Ku Klux, always a Ku Klux.”
Bilbo was also outspoken in his belief that blacks should not be allowed to vote anywhere, the Fourteenth and Fifteenth amendments to the Constitution to the contrary. There were many allegations of disenfranchisement by black veterans, along with allegations that his campaign tactics provoked violence. Bilbo was also accused of giving war contracts out to his friends.
If you succeed in the passage of this bill, you will open the floodgates of hell in the South. Raping, mobbing, lynching, race riots, and crime will be increased a thousandfold; and upon your garments and the garments of those who are responsible for the passage of the measure will be the blood of the raped and outraged daughters of Dixie, as well as the blood of the perpetrators of these crimes that the red-blooded Anglo-Saxon white Southern men will not tolerate.
Bilbo famously denounced Richard Wright's novel, Black Boy, on the Senate floor, "Its purpose is to plant the seeds of devilment and troublebreeding in the days to come in the mind and heart of every American Negro...It is the dirtiest, filthiest, lousiest, most obscene piece of writing that I have ever seen in print. I would hate to have a son or daughter of mine permitted to read it; it is so filthy and so dirty. But it comes from a Negro, and you cannot expect any better from a person of his type.
He was re-elected to a third Senate term in November 1946, but the newly-elected Republican majority in the United States Senate refused to seat Bilbo for the term because he was suspected of openly inciting violence against blacks who wanted to vote and a committee found that he had taken bribes. A filibuster by his supporters delayed the seating of the Senate for days. It was resolved when a supporter proposed that Bilbo's credentials remain on the table while he returned home to Mississippi to seek medical treatment for his oral cancer.
Bilbo died only a few months later at the age of 69 in New Orleans, Louisiana. On his deathbed he summoned the editor of an African American newspaper to make a statement:
I am honestly against the social intermingling of Negroes and whites but I hold nothing personal against the Negroes as a race. They should be proud of their God-given heritage just as I am proud of mine. I believe Negroes should have the right [to indiscriminate use of the ballot], and in Mississippi too—when their main purpose is not to put me out of office and when they won't try to besmirch the reputation of my state.
His funeral at Juniper Grove Cemetery in Poplarville was attended by 5,000 mourners, including the governor and the junior senator.
Bilbo is referred to in the 1947 film Gentleman's Agreement, in Pete Seeger's song, 'Listen Mr Bilbo' (1946), in Lee Hays' song, 'Talking Bilbo' and in the novel Sophie's Choice by William Styron (1979).