The poor showing prompted the idea to release another song from the album, but the band realized that getting a new single to succeed would require a remix of the disappointing work of their current producer and decided to discontinue their association with him in doing so.

"[6] Mark Ellen of Smash Hits described the song as a "soft-shoed lilting shuffle" with "quaintly old-fashioned lyrics" but preferred the instrumental version on the B-side of the 7-inch single because of Hadley's "embarrassing operatic warble".

"[4] Record Mirror had varying opinions; in reviewing the single, Sunie Fletcher called it a "pleasant song" that was "at the very least a welcome break away from the funk rut that "Paint Me Down" got stuck in" but thought it had "naively pompous lyrics" and was "remorselessly slaughtered by Tony Hadley's execrable singing.

"[9] In a retrospective review of the Diamond album, Dan LeRoy of AllMusic wrote that the song "offers an inferior trial run at the approach that would produce the global mega-hit 'True' (this version has an underdeveloped melody, which is OK, since still-improving vocalist Tony Hadley wasn't ready yet for a better one).

[12] The number 30 showing of "Paint Me Down" meant that the studio performance of that song that they filmed for the British music chart television programme Top of the Pops went unaired,[13] so it was clear that an appearance there to promote "She Loved Like Diamond" was not going to happen.

In the music video for the song, close-ups of the lips of the title character are a recurring motif, and band member Steve Norman portrays an artist working on a sketch of the cover art.

The video was filmed in the English spa town of Bath[17] and features an actress portraying the deceased woman in the song who is shown mainly as a ghost haunting the grounds of a country estate.

[18] The members of the group went into "panic mode",[19] but their manager, Steve Dagger, suggested releasing another song from the Diamond album[20] and thought "Instinction" could be remixed to make it suitable for the singles chart.