Hull created an opening in the early stages of the game when Bryan Hughes did well down the left to find space and cross the ball towards Richard Garcia, but the Tigers winger could not get enough on his header at the back post and his effort hit the side-netting.
The home side took the lead on 17 minutes when Dean Windass flicked a throughball over the top of the Leicester defence towards Folan who chased it down and registered his first goal for the Tigers as he neatly slotted the ball into the bottom corner of the net.
Leicester came close to equalising soon after as Alan Sheehan found space in the Hull area and struck a left-footed shot that keeper Boaz Myhill managed to turn past the post for a corner.
Hughes could have put Hull further ahead midway through the first half when Garcia played in a neat ball from the right across the Leicester goal, but the ex-Birmingham midfielder could only place the ball straight into the hands of Marton Fulop from six yards out.
Holloway made two positive changes at half-time in an attempt to get his Leicester side back in the game as Sheehan and Hossein Kaeibi came off for the attacking pair of Carl Cort and Collins John.
Hull were given the chance to double their lead in the 78th minute when Bruno N'Gotty brought down Windass in the box with a late challenge.
Windass took the penalty himself but his right-footed effort was palmed onto the post by Fulop. However, substitute Campbell was the first to react, and the Manchester United loanee fired home the rebound from close range to confirm Hull's victory.