By 1978, AC/DC had released five albums internationally and had toured Australia and Europe extensively. In 1977, they landed in America and, with virtually no radio support, began to amass a live following. The band's most recent album, the live If You Want Blood, had reached number 13 in Britain, and the two albums previous to that, 1977's Let There Be Rock and 1978's Powerage, had seen the band find their raging, rhythm and blues-based hard rock sound. Although the American branch of Atlantic Records had rejected the group's 1976 LP Dirty Deeds Done Dirt Cheap, it now believed the band was poised to strike it big in the States if only they would work with a producer who could give them a radio-friendly sound. Since their 1975 Australian debut High Voltage, all of AC/DC's albums had been produced by George Young and Harry Vanda. According to the book AC/DC: Maximum Rock & Roll, the band was not enthusiastic about the idea, especially guitarists Angus Young and Malcolm Young, who felt a strong sense of loyalty to their older brother George:
Being told what to do was bad enough but what really pissed off Malcolm and Angus was they felt that George was being treated disrespectfully by Atlantic, like an amateur with no great track record when it came to production ... Malcolm seemed less pleased with the situation and went so far as to tell Radio 2JJ in Sydney that the band had been virtually "forced" to go with an outside producer. Losing Harry was one thing. Losing George was almost literally like losing a sixth member of the band, and much more.
The producer Atlantic paired the band up with was South African-born Eddie Kramer, best known for his pioneering work as engineer for Jimi Hendrix but also for mega-bands Led Zeppelin and Kiss. Kramer met the band at Criteria Studios in Miami, Florida but, by all accounts, they did not get on. Geoff Barton quotes Malcolm Young in Guitar Legends magazine: "Kramer was a bit of a prat. He looked at Bon and said to us, 'Can your guy sing?' He might've sat behind the knobs for Hendrix, but he's certainly not Hendrix, I can tell you that much." Former AC/DC manager Michael Browning recalls in the 1994 book Highway to Hell: The Life and Times of AC/DC Legend Bon Scott, "I got a phone call from Malcolm in Florida, to say, 'This guy's hopeless, do something, he's trying to talk us into recording that Spencer Davis song,' 'Gimme Some Loving,' 'I'm a Man,' whatever it was." Browning turned to Zambian-born producer Robert John "Mutt" Lange to step in. Lange was best known for producing the Boomtown Rats number one hit "Rat Trap" and post-pub rock bands like Clover, City Boy, and Graham Parker. In 1979 singer Bon Scott told RAM magazine, "Three weeks in Miami and we hadn't written a thing with Kramer. So one day we told him we were going to have a day off and not to bother coming in. This was Saturday, and we snuck into the studio and on that one day we put down six songs, sent the tape to Lange and said, 'Will you work with us?'" The band had also signed up with new management, firing Michael Browning and hiring Peter Mensch, an aggressive American who had helped develop the careers of Aerosmith and Ted Nugent.
Recording commenced at the Roundhouse Studios in Chalk Farm, north London in March 1979. In his book Highway to Hell, Clinton Walker writes, "The band virtually moved into the Roundhouse Studios in Chalk Farm, spending the best part of three months there. That, to start with, was a shock to AC/DC, who had never previously spent more than three weeks on any one album ... Sessions for the album—15 hours a day, day-in day-out, for over two months—were gruelling. Songs were worked and reworked." Lange's no-nonsense approach was appreciated by the band, whose own work ethic had always been solid. In an article by Mojo's Sylvie Simmons, Malcolm Young stated that Lange "liked the simplicity of a band. We were all minimalist. We felt it was the best way to be ... He knew we were all dedicated so he sort of got it. But he made sure the tracks were solid, and he could hear if a snare just went off." In the same article Angus Young added, "He was meticulous about sound, getting right guitars and drums. He would zero in—and he was good too on the vocal side. Even Bon was impressed with how he could get his voice to sound." In AC/DC: Maximum Rock & Roll, Arnaud Durieux writes that Lange, a trained singer, showed Scott how to breathe so he could be a technically better singer on songs like "Touch Too Much" and would join in on background vocals himself, having to stand on the other side of the studio because his own voice was so distinctive. The melodic backing vocals was a new element to the band's sound, but the polish that Lange added did not detract from the band's characteristic crunch, thereby satisfying the band and Atlantic Records at the same time.
The album's most famous song is its title track. From the outset, Atlantic Records hated the idea of using the song as the album title, with Angus recalling to Guitar World's Alan Di Perna in 1993: