The album's conception came about in late 1966 when a Capitol Records producer named Nick Venet offered Zappa the chance to record an album of orchestral music. At this point in his career he was known to the public only as a rock musician. Zappa assembled approximately 40 of the very best session musicians (including legendary guitarist Tommy Tedesco) at the Capitol Records studio in Hollywood in February and March 1967 to record an album of his instrumental compositions. Though Zappa was credited as conductor the ensemble was actually led by veteran Hollywood musician Sid Sharp under Zappa's supervision. Zappa gave the group an absurd name, the "Abnuceals Emuukha Electric Symphony Orchestra and Chorus", to match the music.
There was a long delay between the initial orchestral recording sessions and final release in May 1968. This was caused by a dispute between MGM Records and Capitol Records. As first prepared for Capitol, the album contained music from the studio orchestra only with a total playing time of about 22 minutes. However MGM had already signed Zappa to their Verve Records division in early 1966 as a member of The Mothers of Invention. Zappa believed his MGM/Verve contract allowed him to work on outside projects as long as he did not sing or play. MGM disagreed. It claimed ownership of the recordings and sued to stop all distribution of the Capitol album. Under terms of the settlement MGM/Verve agreed to purchase the recordings.
This early version of Lumpy Gravy was released on stereo 4-track cartridge tape format in 1967 only. It contains only orchestral music, about a couple of minutes of which is unique material which is not on the LP/CD version. According to Zappa himself, the Capitol 4-track of Lumpy Gravy is one of the rarest official Zappa releases - if not the rarest. Capitol had also begun preparation of the vinyl LP record as well as a 7" single from the album ("Sink Trap" b/w "Gypsy Airs") but these did not get past the test pressing stage.A recording of the all-orchestral version, sourced from a stereo acetate demonstration disc believed to have been stolen from Capitol's vaults, circulated amongst collectors for a number of years. In 2009, the Capitol version was finally released officially (sourced from a mono master tape) as part of the Lumpy Money box set.