The band had been signed by Blanco y Negro on the strength of their debut, Slaughter Joe-produced single "Upside Down" and media attention generated by the band's highly charged and energetic gigs.
The album includes the singles "Never Understand", "You Trip Me Up" and "Just Like Honey". Following reissue on CD in August 1986, the bonus track "Some Candy Talking", which was originally released on the namesake EP, was included on the album, only on the UK Blanco y Negro CDs released in 1986 and 1997; in the USA, it was released on CD by Reprise in 1986 and American Recordings in 1993 without the bonus track. In 2006, the album was remastered and released in DualDisc format without "Some Candy Talking" to conform with the original playlist. In 2011, it was re-released (along with the other five studio albums) by Edsel in collaboration with Rhino as a two-CD set with extra tracks (singles, B-sides, demos and Peel Sessions) and a DVD (NTSC, all-region).
On release Psychocandy received rave reviews. Writing for NME, Andy Gill described it as "a great citadel of beauty whose wall of noise, once scaled, offers access to endless vistas of melody and emotion". Even teen magazine Smash Hits gave it 9½/10 in their review. In the end of year round ups the album placed at number one in NME's list of best albums of 1985 (tied with Tom Waits' Rain Dogs), number 3 in The Face and number 5 in Melody Maker.
Subsequently the album has frequently appeared in "best ever" album lists, such as Q magazine's "100 Greatest British Albums Ever", where it placed at number 88 in 2000. In 2006, Q magazine placed the album at number 23 in its "40 Best Albums of the '80s" list. In 2003, the album was ranked number 268 on Rolling Stone magazine's "The 500 Greatest Albums of All Time" list. The magazine also ranked the album number 45 on its list of the 100 Best Debut Albums of All Time.Allmusic described the album as one that "created a movement without meaning to."
Pitchfork listed Psychocandy as the 23rd best album of the 1980s.Slant Magazine listed the album at number 38 in its "Best Albums of the 1980s" list, saying, "Shaping fuzz into a potent, tactile instrument, The Jesus and Mary Chain helped establish the style of distortion-laden fogginess that would eventually become the foundation for shoegaze."
^"Search the charts". irishcharts.ie. Irish Recorded Music Association. Retrieved 6 January 2013. N.B. User must define search parameters by entering either "Jesus and Mary Chain" into Search by Artist and clicking Search or "Some Candy Talking" into Search by Song Title and clicking Search.
^"Certified Awards Search". British Phonographic Industry. Retrieved 6 January 2013. N.B. User must define search parameters by entering either "Jesus & Mary Chain" into Search, selecting "Artist" in Search by and clicking Go or "Psychocandy" into Search, selecting "Title" in Search by and clicking Go.