The song title is part of a mantra used to assist in bayonet practice - "How does the grass grow? Blood, blood, blood!" Producer Tony Visconti explained to Rolling Stone: "It's about the way that soldiers are trained to kill other soldiers, how they have to do it so heartlessly. 'How Does the Grass Grow' is part of a chant that they're taught as they plunge their bayonets into a dummy."
The references to girls wearing "nylon skirts and sandals from Hungary" and boys riding their Riga mopeds appears to place this song somewhere in the Eastern Bloc during the communist Soviet era.
Bowie revives one of his earliest musical loves when he samples the hook motif from The Shadows' "Apache," sung as a "yah-yah-yah-yah."