In 1988, Annie Lennox got married for the second time; that same year, her first child was stillborn. In 1990, when she was in the early stages of making her first solo album, Diva, Lennox gave birth to her daughter Lola. After taking a few months off, she started working again in her home studio, crafting the album with a group of studio musicians while she cared for Lola, the inspiration for "Precious."
In a blog promoting her 2009 greatest hits album, The Annie Lennox Collection: Limited Edition, Lennox wrote: "It is a very personal, sweet song. I lost my first baby, and when you lose a child you have to carry on in life without them being a continuing part of it. It changes the entire way you see everything. Further on down the line, my daughter was safely brought into the world, and I wrote this song for her, because I was just so profoundly grateful for her existence. Now I have two daughters, and the dedication extends to both my girls, so now the title is plural because I love them both equally with the passion of a mother."