In this song, Springsteen plays the part of a guy who is flush with passion for Candy, who is very popular with lots of guys. The guy in the song comes off a bit delusional, believing he is somehow special to her.
Many assumed that Candy is a prostitute. Asked if this was true in a 2010 interview with Rolling Stone, Springsteen said, "Does it really matter? I'll never tell."
This is one of many Springsteen songs with a girl in the story, but unlike Wendy, Sandy, Sherry, and Rosalita, Candy isn't a typical love interest.
The song developed over the last few months of 1977. The working title at one point was "Candy's Boy," and like the other songs on the Darkness On The Edge Of Town album, it took a lot of takes to get right. It was one of 10 tracks to make the final track list out of about 40; Springsteen thought it fit the theme of the album, which he described as "people tryin' to hold on for the things they believe in, in the face of battering from the outside." (Quote from Springsteen by Robert Hilburn.)