Guernica was conceived by in 1992 to mirror his original ideal at of releasing one-off projects. Guernica was named after Pablo Picasso's 1937 painting. Sleeve designs were deliberately outsourced to London design studio to keep the label's identity separate from 4AD.

released their follow-up on 4AD while moved on to release on and continued to release in their home country Australia on . released no further album. The label's last release, Insides' (1994) was the only time a band released a follow-up project on Guernica.

All vinyl albums issued on Guernica included a bonus 7'' with additional tracks. These vinyl albums and singles were not released separately.