Paceman Steve Harmison then took two wickets in four balls with the help of a spectacular catch by Collingwood at third slip to help reduce Pakistan to 66-3 at the close.
Ian Bell also hit a century for England, scoring exactly 100 not out with last man Monty Panesar at the crease.
England's third century-maker Alastair Cook was out earlier in the day after adding only four to his overnight total of 101.
Leg spinner Danish Kaneria was the most successful of the Pakistan bowlers with 3-119 off 52 overs.
At tea England were 495 for seven in their first innings with Ian Bell on 75, his eighth Test half-century.
Collingwood, who came to the crease with England precariously placed at 88 for three on the opening morning on Thursday, batted for more than seven hours and hit 23 fours in an epic demonstration of fierce concentration and astute shot selection before he was stumped off leg spinner Danish Kaneria.
He gave only one chance, an edge to wicketkeeper Kamran Akmal with his total on 79 on Thursday, although Pakistan were convinced he had been caught behind off Mohammad Sami during Friday's morning session with his score on 131.
Umpire Simon Taufel did not share their belief although video replays indicated the ball had caught the outside edge.
Collingwood, who scored his only other Test century against India in Nagpur this year, was again correct and composed after resuming on 107 in an overnight total of 309 for three.
He scored freely through the leg side and took full toll of any short deliveries outside the off stump. He brought up his 150 from 236 before passing Tom Graveney's 153 scored in 1962, the highest previous England innings against Pakistan at Lord's.
BELL HALF-CENTURY
Bell, recalled to the side at number six in the absence through injury of captain Andy Flintoff, was off the mark immediately with an edge off Sami to the boundary.
He then played the shot of the morning with a wristy drive through mid-wicket for four and played another sweet drive through the leg off Kaneria to bring up the 100 partnership.
Bell reached his 50 after Collingwood's dismissal with six boundaries from 105 balls as Pakistan settled for a policy of containment through Umar Gul bowling wide of the off stump.
Geraint Jones, under pressure to deliver with the bat after averaging only 13 against Sri Lanka earlier in the season, lofted Kaneria for four then slashed Sami for six.
He had nothing further to celebrate on his 30th birthday when he was dismissed lbw for 18 by Kaneria after missing an attempted sweep.
Liam Plunkett lasted only six balls before he was caught at slip by Imran Farhat for a duck. It was Farhat's first catch of the innings after he dropped two chances on Thursday and failed to get to a third.
Pakistan took the second new ball after 2.4 overs of the day's play and were rewarded 13 balls later when Sami knocked Alastair Cook's off stump out of the ground with an inswinging yorker.
Cook, who had added only four to his overnight total of 101 with a fluent square drive to the boundary, had hit 10 fours from 279 balls and his fourth-wicket partnership of 233 with Collingwood was an England record against Pakistan.
