MacMillan began choreographing for the company's choreographic group and two promising early works, Somnambulism (1953) and Laiderette (1954) led de Valois to commission a work from the 25-year-old MacMillan. Danses concertantes was first produced in January 1955. He continued to dance, but gradually gave it up in favour of his true vocation. A string of successful works followed including Solitaire (1956), The Burrow (1958), Le baiser de la fée and The Invitation (1960), The Rite of Spring (1962), La Création du monde (1964) The Song of the Earth and his first full-length work, Romeo and Juliet (1965). The year he choreographed Romeo and Juliet, which has become one of his best-loved pieces, he was appointed resident choreographer at The Royal Ballet.
MacMillan was the director of the Deutsche Oper Berlin ballet from 1966 to 1969, and was made director of The Royal Ballet in 1970. He continued to choreograph and produced a string of masterpieces: Valses nobles et sentimentales (1966), Anastasia (one-act version 1967, three-act version 1971), The Seven Deadly Sins (1973), Manon and Elite Syncopations (1974), Requiem (1976), Mayerling (1978), Isadora (1981), The Prince of the Pagodas (1989) and The Judas Tree (1992). In 1977, aged only 48, he retired as director and took up the position of principal choreographer for The Royal Ballet. MacMillan was knighted in the 1983 Birthday Honours.
MacMillan died of a heart attack on 29 October 1992 while backstage at Covent Garden during a revival of his Mayerling. Jeremy Isaacs, the general director of the Royal Opera House, announced the death from the stage after the performance and asked the audience to "please rise and bow your heads and leave the theatre in silence". That same evening, Birmingham Royal Ballet was dancing his Romeo and Juliet in Birmingham. He is remembered as one of the great choreographers of the twentieth century who was unafraid of confronting controversial issues in his ballets (for example The Invitation and The Judas Tree). He often dwelled on the darker side of human nature and sexuality and some of his works centred on characters who would be considered outsiders in modern society. At the same time, ballets such as Elite Syncopations showed that he was capable of creating works of great wit and charm.
He was married to the painter and sculptor Deborah Williams, with whom he had a daughter Charlotte, a photographer, and both continue to oversee continuing productions of his work.
He liked to knit and his choreographies and other papers contain knitting patterns as asides. He had been taught how to knit by his maternal grandmother, Mary Anne Shreeve.
Although a talented dancer, MacMillan is best known for his choreography, and particularly his work with the Royal Ballet. He also worked with the American Ballet Theatre (1956–7) and the Deutsche Oper, Berlin (1966–69). He succeeded Frederick Ashton as Director of the Royal Ballet in 1970 and resigned after seven years, frustrated at balancing the conflicting demands of creating ballets with administration. He continued as Principal Choreographer to the Royal Ballet until his death in 1992.