Holly represents fertility and eternal life. The ancient Druids considered it sacred for these reasons and would hang it in their dwelling places to bring good luck and protection.
The Druids were not the only group of people to attach special meaning to holly. Both the Romans and early Christians found it special in some way. The Romans would decorate with holly during Saturnalia. This festival occurred during December and celebrated Saturn, who was the god of agriculture and harvest. Early Christians then adopted the tradition of decking houses with boughs of holly from both the Druids and the Romans, although holly began to take on religious significance. For instance, according to HowStuffWorks.com, the bright red berries are said to represent the blood of Jesus Christ, the sharp leaves represent the crown of thorns and the white blossoms represent purity.
There are many Christian legends associated with the holly. In one legend, holly berries were white before stained with Christ's blood. In another legend, holly came from Christ's footsteps.
There are 12 species of holly, ranging from trees to shrubs. English holly is the species most closely related to Christmas. American holly, however, is a common substitute for English holly because of the similarities in appearance.