She's Everything.
Disclaimer: I don't own Hannah Montana, Disney channel does!
Lily knows that Miley loves her like a best friend should love a best friend. Even when Miley fights with her, she knows that Miley loves her like a best friend. But what Miley doesn't know is that she's everything in her world. Yes, Lily loved Miley more as a friend. Lily even suspects that Oliver knows, and maybe everyone else in the school notices it too.
Miley will remain clueless, but to Lily, she's more than a friend. She just hopes that Miley doesn't notice that when she's hugging her, that secretly she wants to kiss her.
That's right, Lily was in love with Miley, but she won't tell her best friend that, because maybe that would ruin her friendship with her.
She hopes that Miley will never know her secret.