The band's four members, Andreas Mattsson (vocals, guitar), Fredrik Norberg (guitar, vocals), PA Wikander (drums) and Kenneth Vikström (bass, 1991-1994), later replaced by Arvid Lind (1995-1999), formed the band in Stockholm in autumn 1991 and released their first mini-album Template (1992) on Skellefteå label A West Side Fabrication. Later that year they issued Lacquer which reached number 34 in the national charts and included the song "Hey Princess". The album was well received by both critics and record buyers and won a Grammis Award. Their acceptance attracted much attention when the group's guitarist Fredrik Norberg said he wished that the members of dance band Arvingarna would die in a bus accident.

The songs were written by Norberg and Mattsson and was initially influenced by British guitar-based shoegazer band My Bloody Valentine and Ride. Popsicle may have laid the foundations of the Swedish indie scene, but it was not until four years later as the band played through to a wider audience, that they had their biggest hit - the single "Not Forever" from the self-titled third album.

Popsicle broke up in April 1999 when Fredrik Norberg, after a Japanese tour, announced that he would quit the band. Six years later the band reunited after a request from the record store Pet Sounds who wanted them to play on the store's 25th anniversary. The band liked the idea and also played an exclusive farewell gig at the Cirkus, Stockholm on April 4, 2005. They came back from hiatus in 2018, playing at Gröna Lund, Stockholm on May 18 and Liseberg, Gothenburg on August 8.