Springsteen recorded this for Darkness On The Edge Of Town, but he left it off because he thought it was too upbeat for the album. It was included on The River to incorporate an element of fun to balance off the ballads.
This is one of several Springsteen songs featuring the first name of a girl who is not a specific real person. Besides Sherry, Springsteen has also sung about Mary, Terry, Wendy, Sandy and Rosie.
Springsteen performed this on his 1980 tour.
Other songs about girls named Sherry include "Sherry" by the 4 Seasons and "Oh Sherrie" by Steve Perry. The Four Seasons were a big influence on Springsteen, as they were a New Jersey group who sang about the problems of the working class, which were very often problems with women.