In 1968, Thorgerson and Powell were approached by their friends in Pink Floyd to design the cover for the group's second album, A Saucerful of Secrets. This led to additional work for EMI, including photos and album covers for The Pretty Things, Free, Toe Fat and The Gods. Being film and art school students, they were able to use the darkroom at the Royal College of Art, but when they completed school, they had to set up their own facilities. They built a small darkroom in Powell's bathroom, but shortly thereafter, in early 1970, rented space and built a studio located at 6 Denmark Street.
When first starting out, Powell and Thorgerson adopted their name from graffiti they found on the door to their apartment. Thorgerson said they liked the word, not only for punning on "hypnosis," but for possessing "a nice sense of contradiction, of an impossible co-existence, from Hip = new, cool, and groovy, and Gnostic, relating to ancient learning."
Hipgnosis gained major international prominence in 1973 with their famed cover design for Pink Floyd's The Dark Side of the Moon. The final design was one of several versions prepared for the band to choose from, but according to drummer Nick Mason, the 'prism/pyramid' design was the immediate and unanimous choice. The record itself was wildly successful—it became one of the biggest-selling and longest-charting albums of all time, putting it in the hands of millions of fans, and it has since been hailed as one of the best album covers of all time (VH1 rated the cover as No. 4, in 2003). After that, the firm became in-demand, and did many covers for high-profile bands and artists such as Led Zeppelin, Genesis, UFO, Black Sabbath, Peter Gabriel, The Alan Parsons Project, and Yes. They also designed the cover for the original UK paperback edition of Douglas Adams' The Hitchhiker's Guide to the Galaxy, as well as the original UK hardcover edition of Norman Spinrad's Bug Jack Barron.
One notable fact was that Hipgnosis did not have a set fee for designing an album cover but instead asked the artists to "pay what they thought it was worth", a policy that only occasionally backfired according to Thorgerson in his book on album cover design.
Hipgnosis' approach to album design was strongly photography-oriented, and they pioneered the use of many innovative visual and packaging techniques. In particular, Thorgerson & Powell's surreal, elaborately manipulated photos (utilizing darkroom tricks, multiple exposures, airbrush retouching, and mechanical cut-and-paste techniques) were a film-based forerunner of what would, much later, be called photoshopping. Hipgnosis used primarily Hasselbladmedium format cameras for their work, the square film format being especially suited to album cover imagery.
Hipgnosis covers were noted for their quirky humour, such as the cover for the Pink Floyd double-LP compilation A Nice Pair, which featured an array of visual puns. This got them in trouble at least once, when a visual pun based on "(tennis) racquet"/"(noise) racket" enraged Jimmy Page of Led Zeppelin and Hipgnosis almost lost the band as a client. (The album in question was Houses of the Holy.)
Another trademark was that many of their cover photos told "stories" directly related to the album's lyrics, often based on puns or double meanings of words in the album title. Since both Powell and Thorgerson were film students, they often used models as "actors" and staged the photos in a highly theatrical manner. Hipgnosis covers rarely featured artists' photos on the outside, and most were in a gatefold cover format to provide ample space for their slickly photographed tableaux.
Many of Hipgnosis' covers also featured distinctively "high tech" pen and ink logos and illustrations (often by graphic designer George Hardie), stickers, fancy inner sleeves, and other packaging bonuses. One of the unique extras created by Hipgnosis was the specially printed inner sleeve for Led Zeppelin's In Through the Out Door LP, a "black and white" affair that magically turned to colour when dampened with water (tying in with the main cover's photographic theme).
^Perrin, Jean-Éric; Rey, Jerôme; Verlant, Gilles (2009). Les Miscellanées du rock (in French). Paris: Éditions Fetjaine / La Martinière. p. 154. ISBN9782354251307. [L]es deux de Hipgnosis avaient la particularité de ne pas réclamer de cachet fixe, mais de demander aux groupes de leur payer ce qu'ils estimaient être la valeur de leur travail!|access-date= requires |url= (help) (The italics are present in the original.)