Friends and family members, many dressed in brightly coloured clothes in the 21-year-old's honour, gathered at her former school to remember the vivacious woman on Friday.
Premier Chris Minns was among those who attended the service at Danebank Anglican School for Girls in Hurstville, which was also live-streamed for a crowd gathered inside St Andrew's Cathedral in the city centre.
Her white casket, adorned with flowers, was carried into the service by pallbearers who included her father.
Mr James said the day was about celebrating his daughter's life.
"She was an independent, vibrant young woman who was always on the go and lived each day to the fullest," he said in a statement.
The funeral was live-streamed for a crowd gathered inside St Andrew's Cathedral in central Sydney.
St Andrew's Cathedral School said the service allowed people to reflect on the extraordinary young woman she was and the profound impact she had on students and colleagues at the school where she coached.
"The James family will remain in our prayers, with Lilie in our hearts forever," the school said in a social media post.
Ms James was found dead with horrific head injuries in the inner-city private school's gymnasium toilets just before midnight on October 25.
A day later, police found the body of her suspected killer, 24-year-old Paul Thijssen, who also worked at the school and with whom Ms James had been in a brief relationship.
Police have said they are not looking for any other suspects in relation to her death.
St Andrew's head of school Julie McGonigle previously said the community had been left "bewildered" as they knew both Ms James and Thijssen.
"Our beautiful Ms James, a ray of light, and Mr Thijssen, whose actions are completely incongruent with who we knew," she said.
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