Parlophone R5570, Produced by George Martin, features the song penned by Paul in the autumn of 1966 when The Beatles had decided to make a concept album inspired by their childhood in Liverpool. Digging into their memories, Paul produced ‘Penny Lane’ and John composed ‘Strawberry Fields Forever’. When the time came for the song to be recorded, Paul had the number completely finished and had drafted out a rough arrangement for the brass section. Paul commented: “Penny Lane is a bus roundabout in Liverpool, and there is a barber’s shop showing photographs of every head he’s had the pleasure to know – no, that’s not true, they’re just photos of hairstyles, but all the people who come and go stop and say hello. There’s a bank on the corner, so we made up the bit about the banker in his motor car. It’s part fact, part nostalgia for a place, which is a great place, blue suburban skies as we remember it, and it’s still there. And we put in a joke or two: ‘Four of fish and finger pie.’ The women would never dare say that, except to themselves. Most people wouldn’t hear it, but ‘finger pie’ is just a nice little joke about the Liverpool lads who like a bit of smut.” Incidentally, the barber’s shop was called Bioletti’s. In his biography, ‘Many Years From Now', Paul recalled, “It was all based on real things; there was a bank on the corner so I imagined the banker, it was not a real person, and his slightly dubious habits and the little children laughing at him, and the pouring rain. The fire station was a bit of poetic licence; there’s a fire station about half a mile down the road, not actually in Penny Lane, but we needed a third verse so we took that and I was very pleased with the line ‘It’s a clean machine".

The track was recorded in January 1967 and among the musicians who were to perform on overdubs were flautists Ray Swinfield, P.Goody, Manny Winters and Dennis Walton; trumpeters Leon Calvert, Freddy Clayton, Bert Courtley and Duncan Campbell; oboists Dick Morgan and Mike Winfield – and bassist Frank Clarke. Clarke was later to say, “I’ve spent a lifetime playing with top orchestras, yet I’m most famous for playing on 'Penny Lane”.