The Mercury Prize, formerly the Mercury Music Prize and currently known as the Nationwide Mercury Prize for sponsorship reasons, is an annual music prize awarded for the best album from the United Kingdom or Ireland. It was established by the BPI and BARD (the British Association of Record Dealers) in 1992 as an alternative to the industry-dominated BRIT Awards. It was originally sponsored by the now-defunct telecoms company Mercury, followed in 1998 by Technics and starting in 2004 the Nationwide Building Society. It is often observed that bands who are nominated for, or indeed win the prize experience a large increase in album sales, particularly for the lesser known nominees. Nominations are chosen by a selected panel of music executives in the music industry in the UK and the Republic of Ireland. The Mercury Prize also has a reputation for being awarded to outside chances rather than the favourites.

The 2001 awards were held on September 11, and when it was announced that PJ Harvey had won the prize for her album Stories from the City, Stories from the Sea, Harvey herself was staying in a hotel in Washington DC which overlooked The Pentagon, which had been hit by one of the hijacked aeroplanes.

The cartoon band Gorillaz resigned from the shortlist in 2001. Bassist Murdoc said winning would be "like carrying a dead albatross round your neck for eternity". Following this, no Damon Albarn-related release -- including albums by Gorillaz, Blur and The Good, the Bad & the Queen -- has since been entered for the Mercury.

The awards usually take place in September but nominated albums are announced in July. In 2007 the shortlist was announced on July 17 at The Hospital in London's Covent Garden. The awards ceremony took place on September 4. The winners were the Klaxons with their album Myths Of The Near Future. The list of nominees for 2007 included two previous winners. The Arctic Monkeys were victorious in 2006, winning with their album Whatever People Say I Am, That's What I'm Not. Dizzee Rascal took home the prize in 2003 for his album Boy in Da Corner.

Less well known were the eight bands and artists that fielded debut albums: Basquiat Strings with Seb Rochford, Bat for Lashes, Jamie T, Klaxons, Maps, New Young Pony Club, Fionn Regan and The View. The other two nominees were the Young Knives and Amy Winehouse, both of which already have one studio album to their name. Amy Winehouse was nominated for her debut album Frank in 2004.