The song has a unique through-composed structure in seven movements in which Orbison sings through two octaves, beyond the range of most rock singers.

[3] In 1956, Roy Orbison was signed to Sun Records, the Memphis-based label that launched rockabilly legends such as Elvis Presley and Carl Perkins.

Orbison found marginal success at Sun Records, but felt that his talents were not being employed appropriately because he was made to sing twelve-bar rock standards with heavy guitars and drums.

With "Only the Lonely", co-written with Joe Melson and recorded by Bill Porter, Orbison's songs turned to introspective and plaintive ballads fully employing his powerful three-octave vocal range, backed by larger and more intricate arrangements.

[5] A recurring musical theme in many of Orbison's songs is a climax represented by a raw, emotionally vulnerable confession sung in an "eerily high falsetto", according to author Peter Lehman.

[11] It begins like a lullaby with minimal acoustic guitar strums, with Orbison introducing the listener to "a candy-colored clown they call the sandman" half-spoken and half-sung in a Sprechgesang fashion.

[6] The tormented narrative of [Orbison's] 1963 hit "In Dreams" veers unsettlingly between melancholy teenage romance and morbid adult obsession...

Echoes of ranchera music offer bittersweet counterpoint from the lulling intro, through the aching verses to a finish that just seems to evaporate.

"[17] During the five months the song was on the charts, Orbison replaced guitarist Duane Eddy on a tour of the UK alongside the Beatles, whom he was not aware of at the time.

After demanding Orbison play for double the time he was scheduled, the audience then screamed for a fifteenth encore, which Lennon and Paul McCartney refused to allow.

[19][20] A compilation of Orbison's most successful songs was re-recorded in January 1986[21] and released in 1987 under the title In Dreams: The Greatest Hits.

[22] In the film, murderous psychopath Frank Booth (Dennis Hopper) is obsessed with the song, which he calls "Candy Colored Clown", and demands it be played repeatedly.

Later, Booth threatens Jeffrey Beaumont (Kyle MacLachlan) and beats him unconscious while the song plays from his car stereo and Dorothy Vallens (Isabella Rossellini) begs him to stop.

[25] Leslie Libman directed a music video for this recording, featuring scenes from Blue Velvet interspersed with live-action shots of Orbison's image projected over a linen cloth blowing in the wind.

[28] On the same album, "In Dreams" received a companion piece, "In the Real World", written by Will Jennings and Richard Kerr.