Thin-walled cold-formed steel (CFS) members are prone to web crippling under concentrated loads, and the presence of web holes affects their web crippling strength. While the Direct Strength Method (DSM) is well-established for estimating the web crippling strength of CFS sections without web holes, research on CFS sections with web holes remains limited. Since critical buckling and yielding loads are key parameters for DSM, this study investigates the critical elastic buckling of CFS lipped channel sections with circular web holes under two-flange load case web crippling. Advanced finite element (FE) models were developed and validated against existing literature to simulate this response. A comprehensive parametric study was conducted, covering a wide range of lipped channel dimensions and web hole diameters. The results show that as the web hole ratio increases, the critical elastic web crippling load decreases, with an average reduction of 53–54% observed for both loading conditions. To address limitations of existing methods, simplified design approaches—an improved critical elastic buckling coefficient and an equivalent reduced thickness approach—were proposed. These new approaches showed improved accuracy in estimating the critical elastic web crippling loads for CFS lipped channel sections with circular web holes.