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Lightfoot moved to California, where he studied jazz composition and orchestration at Hollywood's Westlake College of Music in 1957-58. He returned to Canada and through 1958 to '61 he was performing with The Swinging Eight a group that appeared on CBC TV's Country Hoedown as well as performing with the Gino Silvi Singers. He also began performing in the coffee houses of the Toronto folk scene, playing guitar and singing folk songs. He sang with Terry Whelan in a duo called the Two Tones and they recorded a live album that was released in 1962 called Two Tones at the Village Corner (1962, Chateau CLP-1012). In 1963 Lightfoot traveled to Europe and became for one year the host of BBC TV's Country and Western Show. By 1964, he was back in Canada and that year he appeared at the Mariposa Folk Festival.

Lightfoot was gaining some recognition by this time as a songwriter and two of his songs ("For Lovin' Me" and "Early Mornin' Rain") were covered by Ian and Sylvia Tyson. "For Lovin' Me" was covered again a year later in 1965 by Peter, Paul and Mary, who had a hit with it. That song was again covered by Chad and Jeremy as well as the Johnny Mann Singers. During this time, other artists such as Marty Robbins ("Ribbon of Darkness"), Leroy Van Dyke ("I'm Not Saying"), Judy Collins, Richie Havens, The Kingston Trio and Harry Belafonte were racking up hits with Lightfoot's songs. In 1966, his debut album Lightfoot! was released and it brought him recognition as a singer as well as a songwriter. It featured many now-famous songs including "For Lovin' Me," "Early Mornin' Rain," "Steel Rail Blues" and "Ribbon of Darkness."

On the strength of this album, which mixed Canadian and universal themes, Lightfoot became one of the first Canadian singers to achieve real stardom in his own country without moving to the United States. The album was released internationally and was also well-received. It was followed by numerous other albums through the late 1960s. But he remained better known as a songwriter than as a singer, with cover versions of his songs recorded by artists such as Bob Dylan, Johnny Cash and Elvis Presley.

Lightfoot embarked on his first Canadian national tour in 1967. It included performances in New York City. Between 1967 and 1971, Lightfoot toured internationally through Europe as well as two well received tours of Australia. He curtailed his touring schedule in 1972 after contracting Bell's palsy, a condition which left his face partially paralyzed for a time.

It was not until 1971 that his own version of "If You Could Read My Mind" became a Top Ten hit. The song was originally featured on his 1970 album Sit Down Young Stranger, which had not sold well. After the success of the song, the album was re-released under the new title If You Could Read My Mind to capitalize on the success of the song. It was also in 1971 that, on a bus bound for Calgary, Gordon met a lonely teenage girl named Grace on her way home from Toronto. The following year, the song "Alberta Bound" found its debut on the Don Quixote album.

In 1974, his classic single, "Sundown," from the album of the same name, went to No.1 on the American charts. "Carefree Highway," the follow-up single from the same album, charted in the Top Ten. Two years later, Lightfoot had an unexpected hit with a song with the unlikliest of subject matter. In late November 1975, Lightfoot read a Newsweek magazine article about the Great Lakes ore carrier SS Edmund Fitzgerald sinking during a severe storm. Tragically, all of her 29 crew members died. His song, "The Wreck of the Edmund Fitzgerald," most of the lyrics of which were taken from the article, reached 2 on the U.S. Billboard charts. "Sundown" and "Edmund Fitzgerald" continue to receive heavy airplay on many classic rock stations. After "Edmund Fitzgerald" Lightfoot would have one more top 40 hit on the Hot 100, "The Circle Is Small (I Can See It In Your Eyes)" which reached 33 in early 1978.

Through the 1990s, Lightfoot released two albums and played about fifty tour dates a year. In the fall of 2002, he was in Orillia when he suffered a near-fatal abdominal hemorrhage that left him in a coma for nearly two months. He recovered and later returned to the music business with the album Harmony and an appearance on Canadian Idol. In 2005, he made a low-key tour called, with characteristically droll humor, the "Better Late Than Never" Tour.