 Lyell was commissioned as a lieutenant in the Forfar and Kincardine Artillery Militia in 1900, and served until 1908 when the Militia was dissolved under the Territorial and Reserve Forces Act 1907.He then served as the Vice-Chairman of the County Territorial Association for Forfarshire.On the outbreak of the First World War, he was gazetted a captain in the Fife Royal Garrison Artillery, and in May 1915 made a major in the Highland Battery of the Fife RGA.