[10] In August 1967, Pink Floyd were forced to cancel their appearance at the prestigious National Jazz and Blues Festival, informing the music press that Barrett was suffering from nervous exhaustion.

Band manager Peter Jenner and bassist Roger Waters arranged for Barrett to see a psychiatrist (an appointment he failed to attend), while a stay on the Spanish island of Formentera with Sam Hutt, a doctor well established in the underground music scene, led to no visible improvement in Barrett's behaviour.

[12] At a show at The Fillmore in San Francisco, during a performance of "Interstellar Overdrive", Barrett slowly detuned his guitar; the audience seemed to enjoy such antics, unaware of the rest of the band's consternation.

Waters and fellow band members keyboardist Richard Wright and drummer Nick Mason soon grew weary of Barrett's on-stage antics and, on 26 January 1968, when Waters was driving his bandmates from London to a show at Southampton University, they all agreed to go without Barrett: according to Gilmour's recollection, one person asked, "Shall we pick Syd up?"

"[15] Since Barrett had written or co-written 10 of the 11 songs on their debut album, The Piper at the Gates of Dawn, as well as the band's three singles up to this point, the original plan was to keep him in the group as a non-touring member − in a similar arrangement to what The Beach Boys had done with Brian Wilson − but this soon proved to be unworkable.

[14] After Barrett left Pink Floyd in April 1968, Peter Jenner and Andrew King, from the band's management, followed suit.

[14][24][25] After recording had resumed in June and July, progress continued on these tracks, especially "Swan Lee", and a new, improved version of "Clowns and Jugglers" was taped at this point also.

[14][24][26] Although Jenner claims he got on well with the singer, he would also state that the 1968 sessions had not gone smoothly, admitting: "I had seriously underestimated the difficulties of working with him ..."[19] Shortly after the July dates, Barrett abruptly stopped recording, breaking up with girlfriend Lindsay Corner and then going off on a drive around Britain in his Mini; he ended up in psychiatric care in Cambridge.

[21] After both Jenner and Norman Smith, Pink Floyd's producer at the time, declined to work on the album, Jones agreed to take on the role.

[26] Jones would later comment that the sessions with Barrett had gone well: "Syd was in a great mood, and in fine form, a stark contrast to the rumours and stories I'd been fed.

"[29] Jones also explained the rationale behind EMI letting Barrett record again: "What was decided was to see what was the strength of Syd's new material, and plan accordingly.

If not, we'd call it a day ..."[28] In a meeting at Barrett's flat in Earls Court, unsure of Jenner's production technique, Jones asked to hear some of the previous year's tapes;[30] Barrett played him "Swan Lee", "Late Night", "Rhamadam", "Lanky (Parts One and Two)" and "Golden Hair".

[30] After the playbacks, Barrett performed several songs on guitar for Jones: "Opel" and "Clowns and Jugglers" (both attempted during the sessions with Peter Jenner), and the newly written "Terrapin" and "Love You".

[32] Barrett and his new producer were in agreement that "Opel" was among the best of the new recordings at this time;[32] only two complete takes of the song were taped, though, after multiple false starts.

[32] During the lunch break that day, they talked about improving some of the other songs from the Jenner sessions, particularly "Golden Hair" and "Late Night", the last of which was just a backing track at this point.

[34] After returning to the studio, they worked on "Terrapin", with Barrett requiring just a single take,[34] and added slide guitar and vocals to "Late Night".

When asked if he had any new songs for the following week's session, on 23 April, Barrett replied that he had "a weird idea I want to try out" and that other musicians would not be required.

[35][38] On the morning of the 23rd, Barrett arrived at the studio with a cassette player, on which he had recorded motorbike sounds; these, he told Jones, were "all ready to [be] put onto the 'Rhamadam' four track".

[36] On the session for 3 May, three tracks on the album were overdubbed by Robert Wyatt, Hugh Hopper and Mike Ratledge, all members of the band Soft Machine:[22][26][36][39] The three songs were "Love You", (now dropping "It's") "No Good Trying",[39] and "Clowns and Jugglers".

[nb 5][22][36][38] Even after the Soft Machine members added overdubs to "Clowns and Jugglers", Barrett wished to add bass and drums to it.

"[41] During this time, Barrett also played guitar on the sessions for Soft Machine founder Kevin Ayers' debut LP, Joy of a Toy,[42] although his performance on "Religious Experience" was not released until the album was reissued in 2003.

[38][43] It was around this time that Jones' involvement came to an end – during these last few sessions, Gilmour had started taking an interest in how Barrett was getting along with his album.

[26] During the trip, he asked David Gilmour for his help on the album,[26] and, at the end of May, Malcolm Jones abandoned his production responsibilities.

In his book The Making of the Madcap Laughs, Jones states that "when Dave came to me and said that Syd wanted him and Roger to do the remaining parts of the album, I acquiesced".

[23][62][64] Village Voice critic Robert Christgau, reviewing the 1974 two-LP set which included The Madcap Laughs, praised some of the music as "funny, charming, catchy – whimsy at its best.

"[67] In a bid to increase sales, Jones wrote a letter to music magazine, Melody Maker, under an alternate name, writing how great the album was.

[62] On 6 June 1970, Barrett gave his one and only solo performance, held at the Kensington Olympia,[68] backed by Gilmour and Shirley.

[68] Barrett baffled the audience (and Gilmour and Shirley) when he abruptly took off his guitar after the fourth number and walked off stage.

[68][71][72][73] Several notable musicians and bands have listed The Madcap Laughs as one of their favourite albums of all time: they include David Bowie,[80] Genesis P-Orridge,[81] Kavus Torabi,[82] Jennifer Herrema,[83] Viv Albertine,[84] Cosey Fanni Tutti,[85] Hey Colossus,[86] Graham Coxon,[87] Pete Astor,[88] King Buzzo,[89] John Frusciante,[90] Will Hodgkinson,[91] John Maus,[92] and many others.

[nb 21] For release on An Introduction to Syd Barrett in 2010, Gilmour laid down a new bass track to "Here I Go", and remixed "Octopus" and "She Took a Long Cold Look".