The band was founded in Liverpool by 20-year-old singer, songwriter, guitarist, keyboardist and frontman Ian McNabb. In 1980, McNabb joined up with drummer Chris Sharrock (who had previously drummed for many Liverpool bands) and bassist Chris Layhe (who had been recruited though a classified ad), and they began playing as The Icicle Works. By the end of 1981, the trio had recorded a six-song independently released cassette, and in 1982 they released the independent single "Nirvana". The following year, the Icicle Works were signed to the Beggars Banquet label, who issued the single "Birds Fly (Whisper to a Scream)" on their subsidiary label Situation Two.

Later that year, The Icicle Works' would release their biggest UK hit, 1983's "Love Is a Wonderful Colour", which was a UK Top 15 single. Their debut eponymous album (1984) would follow shortly thereafter, reaching number 24 on the UK charts, and also hitting the U.S. top 40. Also appearing on the U.S. top 40 singles charts at around the same time (and hitting the Canadian top twenty) was "Whisper to a Scream (Birds Fly)", a retitled and very slightly remixed version of The Icicle Works' Situation Two release of 1983.