Alice in Chains released their debut album Facelift on August 21, 1990. The second single, "Man in the Box", with lyrics written by Staley, became a huge hit. "Man in the Box" is widely recognized for its distinctive "wordless opening melody, where Layne Staley's peculiar, tensed-throat vocals are matched in unison with an effects-laden guitar" followed by "portentous lines like: 'Jesus Christ/Deny your maker' and 'He who tries/Will be wasted' with Cantrell's drier, less-urgent voice." Facelift has since been certified double platinum by the RIAA for sales of two million copies in the United States. The band toured in support of the album for two years before releasing the acoustic EP Sap in early 1992. In September 1992, Alice in Chains released Dirt. The critically-acclaimed album, also the band's most successful, debuted at number six on the Billboard 200, and was certified quadruple platinum. The band did not tour in support of Dirt for very long, due to Staley's drug addiction. While touring, Starr left the band due to personal reasons and was replaced by Mike Inez.
Staley playing with Alice in Chains in Boston in 1992.Although Cantrell wrote or co-wrote along with Kinney, Starr, and Inez almost all of the music for Alice in Chains, Staley wrote more and more lyrics as time went on, eventually receiving credit for about half the lyrics from their entire catalog as well as writing three songs musically and lyrically—"Hate to Feel", "Angry Chair" and "Head Creeps".
Staley's lyrics are largely viewed as having often dealt with his struggle against heroin addiction as well as other personal troubles. The album Dirt showcased the former in songs like "Sickman", "Junkhead", "God Smack" and "Angry Chair", the only single for which Staley wrote the music as well as the lyrics.
1994 saw the release of Alice in Chains' second acoustic EP, Jar of Flies. It debuted at number one, making it the first Alice in Chains release—and the first-ever EP—to do so. The other members of Alice in Chains, seeing Staley's deteriorating condition, opted not to tour in support of Jar of Flies. Following its release, Staley entered a rehabilitation clinic and began to work on a side project with several Seattle musicians, including Mike McCready of Pearl Jam and Barrett Martin of Screaming Trees. The band worked on material for several months and eventually scheduled a show at the Crocodile Cafe under the name The Gacy Bunch. Within a few weeks, the band changed its name to Mad Season. In January 1995, Mad Season performed two songs on Pearl Jam's Self-Pollution satellite radio broadcast, "Lifeless Dead" and "I Don't Know Anything". The band completed an album, titled Above, which was released in March 1995. The first single, "River of Deceit", became a modest success on alternative radio, and "I Don't Know Anything" still receives occasional airplay. A live performance filmed at the Moore Theatre in Seattle was released in August 1995 as a home video, Live at the Moore.
During Alice in Chains' hiatus, reports of Staley's addiction began to gain widespread circulation in fan and media communities, in part from changes to his physical condition brought on by prolonged heroin abuse. Referencing Staley's guest-singing appearance with Tool on the song "Opiate", the Seattle Post-Intelligencer reported, "At KISW-FM's 'Rockstock' concert at the Kitsap County Fairgrounds in Bremerton in May 1994—just a month after the death of Kurt Cobain—Staley made a surprise appearance. He looked sickly and wore a wool ski mask to hide his face." Some of the more persistent and unsubstantiated rumors, ranging from gangrene to missing fingers, surfaced during this period. Mark Arm of Mudhoney is quoted as saying: "I remember seeing him in '95… he turned up and was totally green, and my stomach turned at that point—watching somebody on a track that they couldn't get off."
Alice in Chains regrouped to record Alice in Chains, sometimes referred to as "Tripod" (largely due to the image of the three-legged dog, Sunshine, featured on the cover), which was released late in 1995. The self–titled album debuted at the top of the U.S. charts, and has since been awarded—along with Facelift and Jar of Flies—double platinum status. With the exceptions of "Grind", "Heaven Beside You", and "Over Now", the lyrics are all written by Staley, making this album his greatest lyrical contribution to the band's catalogue. To accompany the album, the band released a home video, The Nona Tapes, in which they poked fun at the rumors of Staley's addiction, but the band lapsed again, failing to complete tours planned in support of the album. When asked about the frustration of not touring to support the record, Cantrell provided some insight into how Staley's addictions led to repercussive tensions within the band: "Very frustrating, but we stuck it out. We rode the good times together, and we stuck together through the hard times. We never stabbed each other in the back and spilled our guts and do that kind of bullshit that you see happen a lot."
During the band's appearance on MTV Unplugged, Staley was visibly weak and emaciated, but still able to deliver a strong performance. He made his last performance on July 3, 1996, in Kansas City, Missouri, while Alice in Chains were touring with Kiss after their Unplugged appearance. In October 1996, Staley's ex-fiancée, Demri Lara Parrott, died from secondary complications caused by drug use (bacterial endocarditis). "Drugs worked for me for years," Staley told Rolling Stone in 1996, "and now they're turning against me, now I'm walking through hell."