Well, this one sure seems to be about masturbation: "You put your right hand out give a firm handshake." But, according to Squier in an interview with VH1, the song is actually about the music business.
Squier admits a Queen influence in this song, and Queen's guitarist Brian May was at one point slated to produce the album. When May backed out because of scheduling conflicts, Reinhold Mack, who produced Queen's album The Game, stepped in. In a 1982 interview with Sounds magazine, he said: "I've listened to Queen ever since their first album, I've known them for ten years, and I think they're very innovative and done a lot of things that I like – in the same way that Led Zeppelin has. I don't think I'm making surrogate Queen music. I don't think their albums sound like my albums, I don't think the lyrics are the same, I don't think I write the same way. I think there are elements of similarity you could find in it to a certain extent. But I could probably do that with just about any band given enough time."
This was Squier's first hit, and it came when he was 31 years old and already a 12-year veteran of the music industry, which helps explain the song's meaning. He was in bands called The Sidewinders and Piper before releasing his first solo album, Tale of the Tape, in 1980. Don't Say No was his most successful album, selling over 3 million copies.
Squier released a radically different version of this song on his 1999 acoustic album Happy Blue.
According to Squier, the distinctive drum sound was created by recording the snare drum backwards and playing it just ahead of the real drum.