Fritz Novotny was a librarian at the University of Vienna Department of Art History and taught from 1925 at various Vienna people's education establishments (Volkshochschulen) while studying art history under Josef Strzygowski, whose assistant he became in 1927. Novotny's lifelong passion for French art must have started at the latest in autumn 1928, when he worked for a year in the nineteenth- and twentieth-century French graphic art department at the Albertina. In 1938 Novotny obtained his habilitation at the University of Vienna with a work on Paul Cézanne. His professional contact with the painter Gerhart Frankl, whom he met in 1934 and whose style was influenced by Cézanne, turned into an intense friendship. When Frankl, a Jew, was forced to escape to Britain after the annexation of Austria to the Nazi German Reich, he also attempted to persuade Novotny, who was a Social Democrat, to emigrate as well. He decided against it for family reasons, although he had applied with Otto Demus, Staatskonservator at the Zentralstelle für Denkmalschutz (Central Monument Protection Authority), for a Paul Sachs scholarship at Harvard. He might also have been reluctant to emigrate in view of the possibility for career advancement that presented itself when the Österreichische Galerie director Franz Martin Haberditzl was forced into retirement and the curator Heinrich Schwarz was removed from office in 1938. In early December 1938 he applied for a position at the Österreichische Galerie in Belvedere Palace, where he was hired in 1939 as a researcher. He came to terms with the political situation so as not to jeopardize his career possibilities. Although neither an NSDAP member nor an applicant for membership, Novotny was described by the Gau leadership in 1938 as having an "irreproachable attitude to the NSDAP". As an "apolitical sceptic" who was "completely absorbed in the work for the gallery and research investigation", he supported the "ideological basis for National Socialist government". In 1942 he was promoted to curator 2nd class and in 1948 to curator 1st class. As a Klimt expert, he wrote the foreword in 1943 to the catalogue for the major Klimt retrospective at the Secession organized by the Reichsstatthalter.

After the Second World War and the removal from office of the former NSDAP member Bruno Grimschitz, who during his directorship had given Novotny precise written instructions on the running of the museum in his absence, Novotny became temporary director until the appointment of Karl Garzarolli-Thurnlackh in 1947. At the end of that year, Novotny campaigned with the Federal Ministry of Education for the reinstatement of the art historian and former NSDAP member Karl Ginhart at the University of Technology. Apart from his work at the Belvedere palace, Novotny lectured in the history of art and from 1948 became a non-tenured professor at the University of Vienna. Under the 1946 Vermögensentziehungs-Anmeldungsverordnung (Asset Expropriation Registration Regulation) he was required that year to investigate twenty-six art objects expropriated during the Nazi era and acquired by the Österreichische Galerie, including items from the collections of Gertrude Felsöványi, Viktor Ephrussi and Leopold Weinstein. Ten works were restituted in the post-war period and one exchanged. The other fifteen were investigated under the Art Restitution Act by order of the Commission for Provenance Research, with some restitutions between 2001 and 2012. From 1960 to 1968 he was director of the Österreichische Galerie and was responsible for numerous exhibitions and publications about the grand masters of classical modernism such as Vincent van Gogh and Paul Cézanne. In 1968, the year he retired, he was made an ordinary professor.