There has been a lot of research about the List attribute of the XML schema of Lookup fields. In this post I will summarise their findings and add my 2cents about the pros and cons of each approach.

Some recommended readings on the issue:

http://pholpar.wordpress.com/2010/05/14/declaratively-adding-a-lookup-field-to-a-list-schema-using-the-name-of-the-referenced-list/

http://blogs.msdn.com/b/joshuag/archive/2008/03/14/add-sharepoint-lookup-column-declaratively-through-caml-xml.aspx

A summary of their findings:

• The List attribute can be set to the web-relative URL of the source list, e.g. Lists/SourceList. This however only works when the Lookup field is being defined locally within the list schema like below.

<List xmlns:ows="Microsoft SharePoint" Title="SharePointProject7 - ChildList" ...>
 <MetaData>
 <ContentTypes>
 </ContentTypes>
 <Fields>
 <Field ID="{2EE02D6F-DFF1-417D-AED7-D139B9653D1F}"
 Type="Lookup" Name="MyField" DisplayName="MyField To Display"
 List="Lists/SourceList" ShowField="Title"/>
 </Fields>
 <Views>...</Views>
 <Forms>...</Forms>
 </MetaData>
</List>

• Alternatively, the List attribute can be set to the GUID of the source list.

Pros and Cons

Pros of using the URL approach:

• Simplicity: no additional coding is required

Cons of using the URL approach:

• No reusability: can’t create site columns using this approach
• Can’t create cross-web Lookup fields (i.e. the list using the Lookup field is not in the same subweb as the source list – but is in the same site collection. See this post for how to create these fields: https://bernado-nguyen-hoan.com/2011/02/09/how-to-create-cross-web-lookup-fields-through-xml-schema/).

Pros of using the GUID approach:

• Can create site columns
• Can create cross-web Lookup fields

Cons of using the GUID approach:

• Additional C# coding is required

My recommendation is to use the URL approach only for very simple scenarios where reusability is not a current or likely future requirement. Use the GUID approach for a more future-proof solution.