The song was written by Noel Gallagher in 1991 before he joined Oasis. "Live Forever" was inspired by The Rolling Stones song "Shine a Light". It featured an optimistic outlook which differed from the attitude of the grunge bands which were popular at that time. Noel Gallagher presented a fully composed "Live Forever" to the band for the first time in early 1993 during their rehearsals. According to drummer Tony McCarroll, the band were awed by it. The demo version of the song begins with an acoustic guitar intro. While recording the album version, the producer Owen Morris cut out the intro and replaced it with a drumbeat that was played by McCarroll. Morris further cut a second section in Gallagher's guitar solo. Although Gallagher was upset, Morris felt the part had sounded "a bit like fucking Slash from Guns N' Roses".