According to the band, the song was inspired by an experience that Geezer Butler had in the days of Earth. Butler, obsessed with the occult at the time, painted his apartment matte black, placed several inverted crucifixes, and put many pictures of Satan on the walls. Ozzy Osbourne handed Butler a black occult book, written in Latin and decorated with numerous pictures of Satan. Butler read the book and then placed it on a shelf beside his bed before going to sleep. When he woke up, he claims he saw a large black figure standing at the end of his bed, staring at him. The figure vanished and Butler ran to the shelf where he had placed the book earlier, but the book was gone. Butler related this story to Osbourne, who then wrote the lyrics to the song based on Butler's experience. The song starts with the lyrics:
What is this that stands before me?
Figure in black which points at me
A version of this song from Black Sabbath's first demo exists on the Ozzy Osbourne compilation album The Ozzman Cometh. The song has an extra verse with additional vocals before the bridge. The guitar and bass are tuned down one whole step, resulting in the key position of A being played on the fretboard, but having the pitch as G (octave - D flat) to the listener. It's one of the band's most frequently performed tracks, being featured on every single tour of their career.