Originally the song was called "I'm So Bored With You", and was one that guitarist Mick Jones had written before he joined The Clash. In the first meeting of Jones with singer Joe Strummer after the latter joined the band, Jones played Strummer several of his songs, and when he played him "I'm So Bored With You," Strummer apparently misheard the lyrics as "I'm So Bored with the USA."
Thinking that this would form a great song about the social ills of America, Strummer started coming up with new lyrics before Jones could explain that actually it was about his then-current on-off relationship.
It appears that the song was a work in progress, as in their earlier shows in August and September 1976, the song was in it's original "You" form as a song about the end of a relationship, but by October it had fully transformed into "I'm So Bored with the USA."
The lyrics are a stinging diatribe about the exporting of American culture around the world either by force ("Yankee dollar talk to the dictators of the world, in fact it's giving orders an' they can't afford to miss a word"), or through media or subterfuge ("Yankee detectives are always on the TV, 'cause killers in America work seven days a week"), and advocate an attempt to reclaim culture from US dominance ("Never mind the stars and stripes, let's print the Watergate Tapes, I'll salute the New Wave, and I hope nobody escapes").
The reference to "New Wave" is the first time anyone had used the alternative term to describe punk rock in a song, and made more sense in an earlier lyrical draft where a previous verse referenced the West Coast surfing scene. In the closing lyrical improvisations Strummer also mentions US detective shows Starsky and Hutch and Kojak, which the group professed to like.
Musically, the song owes a debt to "Pretty Vacant" by their contemporaries the Sex Pistols - or does it? Both songs were written and released around the same time, and both bands have speculated that the other may have ripped off their riff.
"I'm So Bored with the USA" was used in an interesting way when played live by The Clash. In Britain it was a concert staple from 1976 to 1978, with occasional revisits thereafter. On American tours however, it was used regularly as a set opener, to in Strummer's words "find out if they had a sense of humor." On the first tour in 1979 it was often booed by the more conservative elements of the crowd, but most people did indeed get the joke and thereafter it was often sung back at the band with gusto from the American audiences - seeming to suggest that they too were tired with America's cultural exports and oppressive cultural dominance worldwide.
Several cover versions of the song exist, including ones by Violent Society and XX Cortez, both recorded in the late 1990s. The indie rock band Arcade Fire also often use the song's chorus to introduce their own song "Windowsill" when performing live.