In the US to go on vacation means to take a trip or have a break from work. In the UK to go on holiday means the same thing. Holiday also has another meaning: a day or days you don't have to work e.g. Labor Day, Martin Luther King Day. In the US these would be called National Holidays, and in the UK they would be called Bank Holidays. The Holidays are essentially the time from Thanksgiving to New Years in the US. Many people have switched to saying "Happy Holidays" instead of "Merry Christmas" to be more politically correct.
I've been working so much that I need a break. I'm going to take a long vacation in the Bahamas this summer!
I've got two weeks off work, so I'm going on holiday to Greece.
Monday will be a holiday, and we won't have classes then.
My favorite holiday is Christmas, because I get presents and eat a lot of good food!
I hate the holiday season, because everyone is so happy, and it just seems so fake.