The roots of Dillon Fence stretch back to a high school band formed by guitarist Greg Humphreys and bassist Chris Goode in their hometown of Winston-Salem, NC. After winning a high school battle of the bands, Humphreys and Goode's group gigged around town for a couple of years but split up in 1985 when the members left for different colleges. The following year, Humphreys introduced Goode to a guitarist friend from the University of North Carolina, Kent Alphin. Inspired to play together again by the songs Humphreys and Goode had completed on their own, the pair joined with Alphin and drummer Brooke Pitts to form a new group called the Magoos, which they changed to Dillon Fence after a strange piece of outsider art Humphreys and Alphin had seen in the town of Dillon, SC, shortly before their first show.

After a period on the North Carolina fraternity house circuit (during which they shared several stages with another struggling local group called Hootie & the Blowfish) and a change of drummers (Pitts ceding the stool to Scott Carle), the band's self-titled EP/demo tape caught the attention of Mammoth Records, which signed the band in 1991. Their first EP, Christmas, was released late that year as a teaser for 1992's full-length Rosemary. Another EP, Daylight, followed later in 1992 as a stopgap release before the much-improved second album Outside In, which sold appreciably better and got more positive reviews than the debut. To catch everyone up, Mammoth reissued Dillon Fence, the six-song EP that had gotten the group signed, later in 1993. The following year, Living Room Scene added a cocksure dollop of '70s rock & roll, similar to Matthew Sweet's Altered Beast or Primal Scream's Give Out But Don't Give Up, but although this album was even more successful than Outside In, the group was splintering under the pressures of recording and touring. Alphin and Goode left the band, replaced by Jim Smith and Andy Ware, and the group proceeded to the next level of indie success: a theater tour opening for the Black Crowes followed by an extended stadium tour opening for Hootie & the Blowfish, with whom Dillon Fence had made a pact during their early struggling days that if one group made it big, they'd bring the other along. That leg-up from their superstar friends didn't help and Dillon Fence split up in 1995 after Mammoth Records rejected the demos for their fourth album.

Greg Humphreys and Andy Ware formed the more rocking Hobex, which signed to Sire Records in the late '90s, while Scott Carle and Kent Alphin formed a more reflective, folk-tinged band called Granger, which released 1996's Underwater Hum on Shanachie. Unexpectedly, the original recording lineup of Dillon Fence re-formed in 2001 for a series of shows. Live at the Cat's Cradle came out later that year, with rumors of a new studio album to follow.