Love Over Gold

Knopfler began writing after the On Location tour ended in Luxembourg on 6 July 1981. Alan Clark and Hal Lindes, who both joined at the end of 1980, were on the record, and it was the last with Pick Withers. It was recorded at the Power Station in New York from 8 March to 11 June 1982. Knopfler produced, with Neil Dorfsman as engineer, the first of a long run of collaborations between the two.

He played four Schecter Stratocasters, a black Schecter Telecaster, an Ovation classical guitar on Private Investigations and Love Over Gold, a custom Erlewine Automatic on Industrial Disease and a 1937 National steel on Telegraph Road. Mike Mainieri added vibraphone and marimba. Private Dancer was meant for the album, with everything but the vocals recorded, before Knopfler handed it to Tina Turner. The Way It Always Starts went on the Local Hero soundtrack with Gerry Rafferty singing.

It reached number one in Australia, Austria, Italy, New Zealand, Norway and the UK, and 19 in the US. Private Investigations reached two in Britain, and Industrial Disease reached 75 on the Hot 100 in 1983. David Fricke of Rolling Stone wrote that the album dared to put art before airplay. The Love Over Gold tour lasted eight months and ended with two sold-out Hammersmith Odeon shows on 22 and 23 July 1983, which became Alchemy.