In 1991, the song was remixed and reissued to promote Eurythmics' Greatest Hits album. It re-charted in the UK, reaching number 48, and was also a moderate hit in dance clubs. Another remix by Steve Angello was released in France in 2006, along with the track "I've Got a Life" (peaking at number 10).
Annie Lennox and Dave Stewart wrote the song after the Tourists had broken up and they formed Eurythmics. Although the two of them also broke up as a couple, they continued to work together. They became interested in electronic music and bought new synthesizers to play around with. According to Stewart, he managed to produce the beat and riff of the song on one of their new synthesizers, and Lennox, on hearing it, said: "What the hell is that?" and started playing on another synthesizer, and beginnings of the song came out of the two dueling synths.
According to Lennox, the lyrics reflected the unhappy time after the break up of the Tourists, when she felt that they were "in a dream world" and that whatever they were chasing was never going to happen. She described the song as saying: "Look at the state of us. How can it get worse?" adding "I was feeling very vulnerable. The song was an expression of how I felt: hopeless and nihilistic." Stewart, however, thought the lyrics too depressing and added the "hold your head up, moving on" line to make it more uplifting.
Commenting on the line "Some of them want to use you … some of them want to be abused", Lennox said that "people think it’s about sex or S&M, and it’s not about that at all".
"Sweet Dreams" was created and recorded in two places, first in the Eurythmics' tiny project studio in the Chalk Farm district of London above a picture framing shop, then in a small room at The Church Studios in North London. The home studio was equipped with a Tascam 80-8, 8-track half-inch tape recorder, a Soundcraft mixer, a Roland Space Echo, a Klark Teknik DN50 spring reverb, a B.E.L. Electronics noise reduction unit, and a single Beyerdynamic M 201 TG microphone. The gear was purchased second-hand after Lennox and Stewart obtained a bank loan for £5000.
Also purchased with the bank loan was a £2000 Movement Systems Drum Computer, one of only about 30 built, with the Eurythmics having to sleep for a few days at the Bridgwater apartment of the manufacturer while their early prototype unit was being assembled. The MCS Drum Computer provided drum sounds, and also triggered sequences on a Roland SH-101 synthesizer, used for the synth bass line. To fill out the complement of instruments, Lennox played a borrowed Oberheim OB-X for sustained string sounds. Their only microphone, a utilitarian model typically used for hi-hat, performed all the acoustic duties, including tracking Lennox's vocals.
Stewart recalls he was in a manic mood while Lennox was depressed. Stewart was upbeat because he had just survived surgery on a punctured lung, and felt like he had been given a new lease on life. Lennox was feeling low because of the poor results from past musical work. She perked up when she heard Stewart first experimenting with the song's bass line sequence. She "leaped off the floor" and started to fill in the song with the Oberheim synth.
According to Stewart, the record company did not think the song was suitable as a single as it lacked a chorus. However, when a radio DJ in Cleveland kept playing the song from the album, and it generated a strong local response, the label decided to release it.
"Sweet Dreams" was Eurythmics' commercial breakthrough in the United Kingdom and all over the world. The single entered the UK Singles Chart at number 63 in February 1983 and reached number two the following month for one week. Although it is one of the most successful songs of the synth-pop genre of the '80s, it could not reach number one, held up by the successful ballad of "Total Eclipse of the Heart" by Bonnie Tyler.
"Sweet Dreams" was the first-ever single released by Eurythmics in the United States when it was released in May 1983. The single debuted at number 90 and slowly eased up the chart. By August, the single had reached number two and stayed there for four weeks before "Sweet Dreams" took the number one spot.
The music video for "Sweet Dreams" was directed by Chris Ashbrook and filmed in January 1983, shortly before the single and the album were released. The video received heavy airplay on the then-fledgling MTV channel and is widely considered a classic clip from the early-MTV era.
The video begins with a fist pounding on a table, with the camera panning up to reveal Lennox in a boardroom, with images of a Saturn V launch projected on a screen behind her, which are later replaced by a shot of a crowd walking down a street. Stewart is shown typing on a computer (actually an MCS drum computer). The camera cuts to Lennox and Stewart meditating on the table. Stewart is next shown playing cello in a field. The scene then returns to the boardroom, with Lennox and Stewart lying down on the table, and a cow walking around them. Stewart is shown again typing on the computer, with the cow chewing something right next to him. The scene cuts to the duo in a field, with a herd of cows, and Stewart still typing. Lennox and Stewart are then seen floating in a boat, with Stewart again playing the cello. The video ends with Lennox lying in bed, with the last shot being a book on a nightstand bearing a cover identical to the album. The screen then fades to black as Lennox turns off the bedside lamp.
In 1995, American rapper and singer Swing (aka Richard Silva II) released a dance cover of "Sweet Dreams" featuring the Sweden-based musician and producer Dr. Alban. The female singer in the song is Swedish singer Birgitta Edoff. Alban produced the single after Swing was signed to his label, Dr. Records. This version was a major hit in Europe, peaking at number four in Finland, number nine in Denmark, number 12 in Sweden, and number 44 in the Netherlands. In the UK, the track reached number 59.
Pan-European magazine Music & Media commented, "Nomen est omen; indeed it's a cover of Eurythmics' first hit. Also, what Swing promises is what you get. It's heavily Eurofied with the Swedish rap specialist cutting his teeth on it." Alan Jones from British magazine Music Week wrote, "From Sweden, Swing featuring Dr. Alban offer a bludgeoning techno version dominated by rap, with occasional reprises of the title line by Birgitta Edoff".James Hamilton from the magazine's RM Dance Update described it as a "cheesier cornily rapped Swedish remake".
Marilyn Manson released a cover version as the first single from Smells Like Children (1995), an EP of covers, remixes and interludes. In his 1998 autobiography, the band's eponymous vocalist said he fought their label to have this track released as a single, saying: "They didn't want to release [it], which I knew would be a song that even people who didn't like our band would like. [Nothing] wanted to release our version of Screamin' Jay Hawkins' 'I Put a Spell on You', which was far too dark, sprawling and esoteric, even for some of our own fans. We battled the label this time, and learned we could win. ... It was a disheartening experience, but it didn't hurt half as much as the fact that no one at our label ever congratulated us on the success of the song."
The track became the band's first legitimate hit. The music video was directed by American photographerDean Karr, and was shot near downtown Los Angeles. It featured images of the vocalist self-mutilating while wearing a tutu, as well as scenes of him riding a pig. It was placed on heavy rotation on MTV, and was nominated for Best Rock Video at the 1996 MTV Video Music Awards. In 2010, Billboard rated it the "scariest music video ever made", beating Michael Jackson's "Thriller". The video also appeared at number three in the publication's 2013 list of "The 15 Scariest Music Videos Ever". Dave Stewart has said that he liked this version of his song, and that "the video was one of the scariest things [he]'d seen at the time." As of 2020, the track has sold 80,000 copies through digital retailers in the United Kingdom, where it is also the band's most streamed music video, generating almost 12 million audio and video streams.
^Larry Starr, Christopher Alan Waterman (2007). Oxford University Press (ed.). American popular music: from minstrelsy to MP3, Vol. 1. ISBN978-0195300536. ""Sweet Dreams" is a good example of commercial new wave music of the early 1980s, an outgrowth of the 1970s new wave/punk scene promoted by major record labels."