Holzman has been married to character actor Paul Dooley, who she met at an improv acting class in New York, since November 18, 1984. They were both living with other people at the time, but gradually built a relationship. Holzman notes they have a 26-year age difference, which makes them quite different in some ways, yet they are still very close: "It's a big part of our lives but in a way it's meaningless." They have a daughter named Savannah Dooley. They live in Toluca Lake in Los Angeles, California.
Her stage writing credits include Serious Bizness. While at NYU she wrote the musical Birds of Paradise (with Composer David Evans), which was produced off-Broadway in 1987 and directed by Laurents. It got scathing reviews.
In 1988, Holzman's husband, actor-writer Paul Dooley, got a job in Los Angeles on the TV series Coming of Age. While visiting her brother, Cinematographer Ernest Holzman, on the set of thirtysomething, Writer Richard Kramer suggested she should write for the show. Ed Zwick and Marshall Herskovitz bought a spec script from Holzman, and she went on to become a staff Writer on thirtysomething in 1989. She wrote nine episodes during its last two seasons. Zwick and Herskovitz later executive produced My So-Called Life, a show about a teenage girl. Holzman went from story Editor to executive story Editor to a creator and Writer of the show.
Holzman has collaborated on various short films with her daughter, Savannah. They penned a TV pilot based on the Sasha Paley novel Huge, which ABC Family greenlit in January 2010 with a direct-to-series order. Huge premiered in late June 2010. The show team included Holzman, Dooley, her daughter, and her brother, who was the Cinematographer. The series was cancelled on October 4, 2010 due to low ratings compared with the network's other summer hits.
From 2014 to 2016, Holzman was one of the producers and Writers of the Showtime series Roadies, a behind-the-scenes comedy about people working with a touring rock band created by Cameron Crowe, J.J. Abrams (executive producing), and Holzman, that ran for a season. The series starred Luke Wilson, Imogen Poots, Keisha Castle-Hughes, Peter Cambor, Rafe Spall and Carla Gugino.