Like XTC's previous Dukes of Stratosphear side project, "Skylarking" was heavily influenced by the music of the 1960s. Most of its recording was at Rundgren's Utopia Sound Studio in Woodstock, New York. Rundgren played a large role in the album's sound design and drum programming, providing the band with orchestral arrangements and an assortment of gear. However, the sessions were fraught with tension, especially between Rundgren and bandleader Andy Partridge, and numerous disagreements arose over drum patterns, song selections, and other details. In 2010, it was discovered that a wiring error made during the mastering process caused the album to have a "thin" sound. The problem was corrected on subsequent remasters.