Zappa in New York was released in the UK by Zappa's DiscReet Records label in 1977, then quickly withdrawn. A second version was re-released internationally in March 1978 with changes ordered by DiscReet's distributor, Warner Bros. Records. The 1978 edition reached #57 on the Billboard 200 albums chart in the United States.
Immediately following the 1976 concerts, Zappa spent time in the studio adding a significant number of overdubs to the live recordings. Several of these recordings were originally intended for the shelved album Läther, including "The Illinois Enema Bandit", "The Black Page #1", "Big Leg Emma", "Punky's Whips", "The Purple Lagoon" and "I Promise Not to Come in Your Mouth."
The album features members of the Saturday Night Live band, including Lou Marini and Tom Malone, as well as the Brecker Brothers. In addition, Don Pardo was invited by Zappa to the Palladium concert, and he provides introductory narrations to "Punky's Whips" and "The Illinois Enema Bandit". On the CD version, Pardo also delivers a verse of "I'm the Slime" (he did the same for Zappa's 1976 Saturday Night Live appearance).
Zappa in New York was first released in early 1977 with Zappa's original track listing. A small number of LP copies reached stores in England before the album was quickly withdrawn. In 1978, some original cassette copies also appeared in the United States, though, apparently by mistake. Before re-issuing the album in March 1978, Warner Bros. Records removed one of the longest songs, "Punky's Whips". This reduced the playing time of side one to a mere ten minutes, moving "Big Leg Emma" from side 2 to the end of side 1; "Titties & Beer" was also edited to remove references to the song "Punky's Whips". The changes made to the album without Zappa's consent violated his contract, which gave him total artistic control over album content.
When Zappa's distribution agreement with Warner Bros. ended in 1982, all release rights reverted to him. Zappa re-issued Zappa in New York as a double CD in 1991 with the addition of four bonus tracks ("Cruisin' for Burgers", "Punky's Whips", "I'm the Slime", "The Torture Never Stops"). The CD reissue was remixed to feature guitar overdubs that were recorded at the time of the album's issue but not included on the original vinyl, and contained a different recording of "Punky's Whips" and the full-length unedited "Titties & Beer".