The script that uses Raphael is probably running before the "holder" element has been created.
Either create the Raphael in a ready/onload event or trivially arrange the HTML like so:
<body>
<div id="holder"></div> <!-- also use correct closing tag -->
<script src="raphael.js"></script>
<script>
var paper = new Raphael("holder", 320, 200);
// ..
</script>
</body>