Ecstasy is one of Lou Reed's later albums (his 18th), and it's all about the malaise of modern life, especially when it comes to a love gone stale ("It's all downhill after the first kiss). In "Modern Dance," he sings about all the places he could go to escape these doldrums, figuring that a change in location might solve his problems. But, he is gripped with indecision, as his options are overwhelming: Amsterdam? Tangiers? The Yucatan, where they have clear gender lines? The barrage of choices seem to be a coping mechanism that will keep him from taking any real action.
Reed made a video for this song where he's dressed in a chicken suit. Female dancers pluck his feathers off until there are none left, but then put him in a pot to reattach them. The video was directed by Stefan Sagmeister, who primarily works in design.
The 2006 Peter Bjorn and John song "Amsterdam" was inspired by this track.