It was created in January 2002 by VML Inc (Previously Studiocom)[1] an Atlanta-based digital agency using core technology from Sulake Corporation, the company responsible for a similar popular online game called Habbo Hotel.

[2][3] Version 2 of the game was released in late 2004 on a new technology platform called Galapagos, created by Studiocom, and featuring new locations and a special double-reward 'Coca-Cola Red Room'.

The in-game currency was decibels, and was rewarded for: receiving 'Thumbs Up' votes from other users whilst performing music; drinking Virtual Coca-Colas found in crates, vending machines, and refrigerators; playing other games on the Coke Studios website; and filling out surveys.

There are various locations based on real-life cities where the user can perform their music, such as San Francisco, Mexico, Goa, Tokyo, and London.

The Shark Tale sponsorship changed the entire game, turning every avatar into fish in the style of the characters in the movie, and the rooms were underwater themed.

It contains additional features which did not exist in the original game, such as infinite worlds, mining, and the ability to customize the layouts of private studios.

[8] Carol Kruse, vice president of Global Interactive Marketing at Coca-Cola, stated in an interview that "to evolve Coke Studios we needed a digital partner that offered technology and capabilities that we didn’t have".