The Reds are at Bloomfield Road tonight.
And Holloway fears Dalglish's return could end in failure and rejection. Citing the example of Newcastle favourite Alan Shearer, who was not offered the manager's job on a permanent basis after failing to save his hometown club from relegation, Holloway said he hopes Dalglish does not come to regret his decision.
"To come back into it after 10 years is a big step," said Holloway. "I hope they get it right because Kenny deserves to not ruin what he's got with the fans - and football fans can be fickle. He can't carry the can for all this. It will take time.
"I don't see him as being the great golden saviour. I just see him as someone Liverpool fans trust at a time when they've lost faith."