The afternoon started well for Latics as Holloway slid the ball into the bottom corner to give them the lead just before the hour mark.
Rochdale equalised before half time through an Ian Henderson penalty, before he was dismissed on 44 minutes for two bookings.
Dale grabbed two early goals in the second half to put them in control before Holloway scored arguably the goal of the season to get Latics back in the game.
However, as much as Latics pushed for the winner, they were met by a stubborn Josh Lillis in the Rochdale goal.
That result meant Latics drop back down to third from bottom in Sky Bet League One, one point off Blackpool in 20th position.
John Sheridan made one change to the side which beat Blackpool in midweek as Tareiq Holmes-Dennis replaced the injured Brian Wilson.
It would be Rochdale who started the game the stronger as Latics struggled to get a hold of the ball.
However, it would be Athletic who had the first chance of the game from the impressive Holloway.
The striker latched onto the end of a Mike Jones cross but Rochdale goalkeeper Josh Lillis managed to save.
The next chance of the game fell to Liam Kelly but he sliced wide after great work from Holloway.
With both sides settling into the game, they started to enjoy spells of possession.
Donal McDermott struck over the crossbar on 18 minutes in Dale’s first real opportunity of the half.
Holloway almost gave Latics the lead midway through the half after great build up work.
Jones crossed towards Curtis Main who knocked it across to Holloway to head goalwards but Lillis managed to tip wide of the goal.
Latics had the momentum and just before the half hour mark, Latics took the lead.
Jonathan Forte’s low cross picked out Main in the centre who cut the ball back to Holloway and he placed into the bottom corner past the goalkeeper.
That lifted the Oldham Athletic supporters, as Latics went in search for more goals on the pitch.
Henderson was booked on 31 minutes for a clash with Latics captain Kelly before he gave Rochdale the equaliser five minutes later.
Tim Dieng was adjudged to have fouled Callum Camps in the penalty area and Henderson picked himself up to strike past Joel Coleman to bring Rochdale level.
Latics almost responded immediately as Holmes-Dennis picked out Holloway in the centre who forced a good save from Lillis.
Dale were reduced to 10 men just before half time as Henderson went in late on Main and was booked for a second time and received his marching orders.
It was a nightmare start to the second half for Latics as Rochdale grabbed two quick goals to put them in control of the game.
They took the lead on 49 minutes as McDermott’s corner was diverted into his own goal by Gerrard.
Five minutes later and Rochdale extended their lead through a superb strike from Camps.
The midfielder picked up the ball in the middle of the park, raced forward and struck a sweet strike into the top corner to give Dale a two-goal advantage.
Latics almost responded on the hour mark but it was the linesman’s flag which denied them a goal back.
Holloway managed to get space in the centre and rifled home but the linesman’s flag was up to deny him his second of the game.
Sheridan brought on Connor Brown and Timmy Thiele, changing to a 3-5-2 formation in a bid to change Latics’ fortunes.
That had a positive effect on proceedings as Latics managed to pull a goal back through a wonder strike from Holloway.
The ball fell perfectly for the striker on the volley and he rifled into the top corner from 25 yards to get Latics back in the game.
Latics had the momentum and were being cheered on by the loud vocal support, and they almost found an equaliser two minutes later.
Holmes-Dennis, who was proving to be a threat down the left, got on the end of a Brown cross but guided it just wide of the post.
Rochale were doing their best to slow the game down, with Sheridan receiving a talking to from the referee about how long a Dale substitution was taking.
Gerrard lined up a free kick with 10 minutes of the game remaining but struck the wall as Latics pushed and pushed for an equaliser.
It would be the central defender who again went close in the final minute of normal time as he blasted inches over the bar from 35 yards.
With time running out, Latics won a late free kick which Palmer delivered into the box but the linesman’s flag was up for offside and Rochdale came away with the victory.
Oldham Athletic: Coleman, J.Wilson, Dieng (Croft 87’), Gerrard, Holmes-Dennis, Kelly, Palmer, Jones (Brown 62’), Forte (Thiele 62’), Main, Holloway.
Subs not used: Cornell, Mills, Winchester, Tuohy.
Rochdale: Lillis, Rafferty, McNulty, Eastham, McDermott (Vincenti 74’), Canavan, Mendez-Laing (Holt 77’), Allen, Rose, Camps (Cannon 84’), Henderson.
Subs not used: Lancashire, Diba-Musunga, Syers, Hooper.
Goals: Oldham Athletic (Holloway 29’, 71’) 2-3 Rochdale (Henderson 37’, Gerrard OG 49’ Camps 55’)
Attendance: 6,117 (1,242 visiting supporters)