Lüthi grew up in the Emmental region of Switzerland and began racing pocket bikes at the age of nine, winning pocket bike championships in 1999 and 2000. In 2002 he finished second overall in the European 125cc Championship and third in the German 125cc series, establishing himself as a strong junior talent. That same year he made his first 125cc World Championship appearance at the German Grand Prix, finishing in 26th place.
Lüthi entered his first full 125cc World Championship season in 2003 under the management of Daniel Epp's Elit Grand Prix Team, scoring his first podium in Barcelona. The 2004 season proved difficult, with four consecutive retirements and four missed races due to injury, leaving him with only 14 points.
The 2005 season transformed Lüthi's career. Under the guidance of California Superbike School instructor Andy Ibbott, he scored his first 125cc victory at Le Mans and followed it with three more wins across the season, including one at his team's home race at Brno in the Czech Republic. On 6 November 2005 at Valencia, Lüthi secured the 125cc World Championship title, making him the sixth-youngest person to claim the honour. Riding a Honda RS125R, he finished five points clear of Mika Kallio. The title made him Swiss Sportsman of the Year in 2005, and he also won the annual Swiss Award in the sport category.
The championship battle with Kallio that year was famously decided in part by a controversial incident at the Qatar Grand Prix. Kallio's KTM teammate Gábor Talmácsi overtook the Finn on the final straight in the closing meters of the race, taking the win by 0.017 seconds and costing Kallio five crucial points. Those five points proved to be the exact margin by which Lüthi won the championship at the final round in Valencia.
After retaining the Elit team for 2006 — now renamed Elit Caffè Latte and joined by German rider Sandro Cortese — Lüthi managed only a single win at the French Grand Prix. Álvaro Bautista claimed the 2006 125cc title that year in dominant fashion.
Following his 125cc title, Lüthi graduated to the 250cc class in 2007 with the Emmi Caffè Latte team, switching to Aprilia machinery. He achieved his first 250cc podium at the 2008 Italian Grand Prix and an additional second place at Assen, but struggled to consistently challenge for wins. A seventh-place overall finish in 2009 ended his time in the intermediate class.
When the 250cc category was replaced by Moto2 in 2010, Lüthi remained with the team and found renewed competitiveness. He finished second at Silverstone and third at Assen in his debut Moto2 season. Over the following decade he became one of the most consistent performers in Moto2, eventually holding the class records for most points scored (1,852) and most podiums (53), as well as 18 fastest laps. In the 2013 Czech Grand Prix he was among the leading riders in a battle that included eventual race winner Mika Kallio and Japanese rider Takaaki Nakagami.
In 2018 Lüthi stepped up to MotoGP with the EG 0,0 Marc VDS team alongside Franco Morbidelli, but failed to score a single championship point throughout the season, with a best result of 16th place at several rounds. He returned to Moto2 for 2019 with Dynavolt Intact GP and continued racing until announcing his retirement on 19 August 2021 after the conclusion of that season.
Lüthi's 2005 125cc championship remains one of the most memorable in the class's history, decided by the narrowest of margins in a season-long duel with Kallio. His longevity in Grand Prix racing — nineteen years across four classes — and his Moto2 statistical records underscore a career defined by consistency and technical precision. After retiring from racing, he took on the role of Sports Director at the Prüstel GP Moto3 team and their Junior Team from 2022 onwards.