Story behind Smoke on the Water, by Deep Purple

We all came out to Montreux
On the Lake Geneva shoreline
To make records with a mobile
We didn't have much time
Frank Zappa and the Mothers
Were at the best place around
But some stupid with a flare gun
Burned the place to the ground
Smoke on the water, fire in the sky

They burned down the gambling house
It died with an awful sound
Funky Claude was running in and out
Pulling kids out the ground
When it all was over
We had to find another place
But Swiss time was running out
It seemed that we would lose the race
Smoke on the water, fire in the sky

We ended up at the grand hotel
It was empty cold and bare
But with the Rolling Stones truck thing just outside
Making our music there
With a few red lights and a few old beds
We make a place to sweat
No matter what we get out of this
I know we'll never forget
Smoke on the water, fire in the sky

Smoke on the Water, by Deep Purple

Released in May 1973, Smoke on the Water is a standout rock classic and a longtime favorite of mine.  The music and the musicians alone can make a song fly, especially the superb guitar solo by Ritchie Blackmore.  But when the lyrics tell a compelling story and do so with fine poetry, then, to me, the song soars.  The band relates this story in the music video above, but here it is in more detail:

The lyrics of the song tell a true story: on 4 December 1971 Deep Purple were in Montreux, Switzerland, where they had set up camp to record an album using a mobile recording studio (rented from the Rolling Stones and known as the Rolling Stones Mobile Studio—referred to as the "Rolling Stones truck thing" and "a mobile" in the song lyrics) at the entertainment complex that was part of the Montreux Casino (referred to as "the gambling house" in the song lyric). On the eve of the recording session a Frank Zappa and The Mothers of Invention concert was held in the casino's theatre. In the middle of Don Preston's synthesizer solo on "King Kong", the place suddenly caught fire when somebody in the audience fired a flare gun into the rattan covered ceiling, as mentioned in the "some stupid with a flare gun" line. The resulting fire destroyed the entire casino complex, along with all the Mothers' equipment. The "smoke on the water" that became the title of the song (credited to bass guitarist Roger Glover, who related how the title occurred to him when he suddenly woke from a dream a few days later) referred to the smoke from the fire spreading over Lake Geneva from the burning casino as the members of Deep Purple watched the fire from their hotel. The "Funky Claude" running in and out is referring to Claude Nobs, the director of the Montreux Jazz Festival who helped some of the audience escape the fire.

Left with an expensive mobile recording unit and no place to record, the band was forced to scout the town for another place to set up. One promising venue (found by Nobs) was a local theatre called The Pavilion, but soon after the band had loaded in and started working/recording, the nearby neighbours took offence at the noise, and the band was only able to lay down backing tracks for one song (based on Blackmore's riff and temporarily named "Title n°1"), before the local police shut them down.

Finally, after about a week of searching, the band rented the nearly-empty Montreux Grand Hotel and converted its hallways and stairwells into a makeshift recording studio, where they laid down most of the tracks for what would become their most commercially successful album, Machine Head (which is dedicated to Claude Nobs).

The only song from Machine Head not recorded entirely in the Grand Hotel was "Smoke on the Water" itself, which had been partly recorded during the abortive Pavilion session. The lyrics of "Smoke on the Water" were composed later, and the vocals were recorded in the Grand Hotel.

Reference: Smoke on the Water.