The concept of the album was initially conceived by Anderson in the late '80s while reading the book The Power of Silence by Carlos Castaneda, and attending a reception for the displacement of native Hopi people in California.

As a result of that gathering, he was able to later connect with Chief Ernie Longwalker who reluctantly allowed for his spoken word stories to be recorded for use on the project, which revolved around Jon's songs inspired by the stories of indigenous people, including the mysterious Toltecs.

Following legal threats preventing the use of Castaneda's title (Jon had initially wanted "to marry them together, to sell the record and the novel"), and with Geffen Records unhappy with the perceived lack of commercial potential (and Anderson's refusal to edit it for radio), the album's rights were sold to Windham Hill, who eventually released it – essentially the same music, with added narration – as Toltec in 1996.

It tells the tale of the Toltec, a Native American concept of a group of people who have been all over the Earth, existing within different cultures throughout the centuries.

They are described in the album liner as "Creators of the circles of power, color, perfume, and music healing domes."