Named for the cocktail margarita, with lyrics reflecting a laid-back lifestyle in a tropical climate, "Margaritaville" has come to define Buffett's music and career.

[10] In 2023, the song was selected for preservation in the United States National Recording Registry by the Library of Congress as being "culturally, historically, or aesthetically significant.

A few days later, Buffett played a rough version of the song, then called "Wasted Away Again in Margaritaville," and Putnam and others at the studio realized it had potential as a hit.

[13] The song is about a man spending an entire season at a beach resort community, with three verses that describe his day-to-day activities.

In the first verse, he passes his time playing guitar on his front porch and watching tourists sunbathe, all the while eating sponge cake and waiting for a pot of shrimp to boil.

In the third and final verse, he steps on a discarded pull-tab, cutting his heel and ruining the flip-flops he is wearing, then returns home to ease his pain with a fresh batch of margaritas.

The three choruses reveal that the narrator is pondering his recent failed romance, and his friends are telling him that his former girlfriend is at fault.

So the overall story that the song tells is not hedonist enjoyment of life in the sun, but rather almost the opposite; it's a man's gradual recognition, while drowning his sorrows in alcohol, that it was his foolish actions that destroyed the chance of happiness with the woman he loved.

When "Margaritaville" was released to radio stations in 1977, the single edit ran for 3:20, cutting out the instrumental break, and the section during the third chorus and final refrain.

Jimmy Buffett also re-recorded this song as well as "Cheeseburger in Paradise" and "Volcano" specifically for Rock Band as downloadable content.

In 2006, Kenan Thompson did a parody of the song during the Weekend Update segment on Saturday Night Live, where he plays a soldier who found out he was going to the U.S.-Mexico border, rather than Baghdad.