At some point he moved to Los Angeles, California, and found work as a character actor in Hollywood. Diminutive and distinctive-looking, with a strongly featured pock-marked face and charismatically voiced with an English Midlands provincial accent, he was cast in sinister roles, often in horror films. These ranged from uncredited bit parts to prominent roles in the Sherlock Holmes thriller Terror by Night, the all-star monster rally House of Dracula and three Val Lewton productions including The Ghost Ship. In the last, a voice-over narrative by Knaggs is heard, representing the thoughts of his character, a mute seaman.
Back in London, he married Thelma Crawshaw in 1949, then returned to Hollywood. The last film in which he appeared was Fritz Lang's period adventure based on J. Meade Falkner's novel Moonfleet.