John, Johnstone, Dee Murray and Nigel Olsson, who would be the main musicians on the next album (Honky Chateau), would soon join with percussionist Ray Cooper and form the best-known line-up of his mid-1970s band. As with all John songs during this period, the lyrics were penned by his writing partner, Bernie Taupin. This was the last album to be recorded at London's Trident Studios. They relocated to Château d'Hérouville for the next three albums. Caleb Quaye and Roger Pope wouldn't play with John again until Rock of the Westies in 1975, following Murray and Olsson's departure from the band.
Upon its release, Madman Across the Water was almost ignored in John's homeland, barely reaching #41 on the UK Albums Chart and spending only two weeks there. It has been the lowest-charting album of his career to date. The album fared better in North America, peaking at #8 on the U.S. Billboard Top Pop Albums and placing at #10 on the year-end list of 1972. It received Gold by the RIAA in February 1972, achieving $1 million in sales at wholesale value just in the United States. In 1998, the album was certified Multi-Platinum, representing shipments of over 2 million units in the U.S.
The title song was set to be released on John's previous album Tumbleweed Connection. However, it was set aside and would eventually be re-recorded and serve as the title track of this album. Previous versions of the song (from the Tumbleweed sessions with Mick Ronson on guitar) can still be found, specifically on the remastered Tumbleweed Connection CD.
When it was released in 'The Classic Years' collection, it was the first album not to feature any bonus tracks. One known track recorded at the time, "Rock Me when He's Gone," was released on the 1992 compilation Rare Masters. The song was written for and recorded by one of John's long-time friends, Long John Baldry. This was John's first album in which he plays his piano and no other keyboards and the first album in which Davey Johnstone played on, a role that would continue for decades, and he contributed acoustic guitar, mandolin and sitar; he would join John's band full-time for Honky Chateau.
When this album was issued on cassette, MCA swapped the places of "Razor Face" and "Rotten Peaches" on side one and two of the tape.
The SACD version of the album contained a longer version of "Razor Face", which extended the song-ending jam to 6:42 instead of the early fade on the original album. This extended version can only be heard in the 5.1 surround mix.