Consisting of veterans of Reykjavík's early 1980s rock culture, the band took elements of the post-punk sound that characterised the scene, intending to create a humorous take on pop music's optimism, which is reflected in the album's title.

[5] After influential magazine NME declared it "Single of the Week", the Sugarcubes, especially lead singer Björk, unexpectedly got the attention of the British music press.

[5] Across the following months, the band reluctantly appeared on the covers of the United Kingdom's most prominent pop magazines[5] and experienced "massive hype" which generated a wave of interest from the press and the public.

"[11] White stuck to using flat-color backgrounds; this discipline was born out of the need to keep printing costs as low as possible, and had previously been followed for the sleeve designs of the "Birthday" and "Coldsweat" singles.

"[17] Los Angeles Times critic Robert Hilburn commented that "Life's Too Good has the feel of an impact album: one of those rare debuts—like the first X or Talking Heads albums—that not only influence the creative underground but stretch the overall boundaries of rock.

[8] In 2014, Treble wrote that the album "[generated] a larger interest towards the country’s popular and alternative music scenes alike.

"[23] The album is considered a definite influence on all subsequent Icelandic popular music, and on international acts such as Savages and Florence and the Machine.