The band was formed in East Haven, Connecticut in 1998 with the original lineup consisting of guitarist Tim Palmieri, bassist Ron Spears, drummer Adrian Tramontano, and keyboardist Jordan Giangreco. They decided on their first name, Psychedelic Breakfast, based on the suggestion of Tramontano's cousin. It is a reference to the Pink Floyd song "Alan's Psychedelic Breakfast", from their album Atom Heart Mother. The band then began playing shows in Northeast and released their first album, Psychedelic Breakfast, in the summer of 1999. Four songs from that album were featured on the MTV series Undressed.
The band released their second studio album, Deuce, in the summer of 2001, followed by their only live album, Bona Fide, in the winter of 2003, a time during which they began supplementing their Northeast shows with the occasional national tour.