Lister began working as an iron-molder in his brother's foundry in Tacoma. He operated a foundry and woodworking shop as well as working in real estate and insurance. He owned Lister Construction Company from 1903 to 1912, and President of Lister Manufacturing Company. He married Mary Alma Thornton on February 28, 1893, and they had two children, Florence and John Ernest. He was elected to the Tacoma City Council in 1894 as a Populist. After a successful management of Governor John Rankin Rogers' campaign in 1896, Lister was appointed chairman of the State Board of Control.
Lister became the only person of foreign-birth to occupy the governor's mansion, and the only elected Democrat in Washington's executive branch of government when he was elected in 1912. He was sworn into the office on January 11, 1913, re-elected in 1916, and remained in it until his death six years later. As governor, he supported agricultural aid, irrigation and reclamation projects, and state industrial accident insurance. He vetoed legislation that would have denied civil rights to members of the Industrial Workers of the World. And his efforts helped bring the eight-hour work day to the Pacific Northwest. He became ill during his second term and relinquished his office to the Lieutenant Governor.