The English composer joined the university’s music department in 1920 and taught harmony and composition until 1923.
Holst also conducted the university’s orchestra and choral society, which lead to the incident in 1923 where he suffered a concussion after falling from the stage while conducting.
Material from the university’s archive highlights the students' admiration for their lecturer, with documents describing the composer as 'a curious blend of the visionary and the practical'.
Sir David Bell, Vice-Chancellor of Reading University, said: 'We are delighted to be celebrating the achievements of noteworthy individuals and their contribution to the University. Gustav Holst was one of the truly great composers. Being a student of his must have been exciting and inspiring. It is therefore fitting that we recognise his University of Reading career in this manner'.
The plaque is part of a commemorative scheme currently being undertaken by the university. In the last year, Reading-born music legend Geoff Goddard and Edith Morley, the first woman to be awarded the title of a professor at a British university, have both been honoured through the scheme.