Dire Straits were a British rock band formed in London in 1977 by Mark Knopfler (lead vocals, lead guitar), David Knopfler (rhythm guitar, backing vocals), John Illsley (bass guitar, backing vocals), and Pick Withers (drums, percussion). The band was active from 1977 to 1988 and again from 1990 to 1995.

Their first single, "Sultans of Swing", from their 1978 self-titled debut album, reached the top ten in the UK and US charts. It was followed by a series of hit singles including "Romeo and Juliet" (1981), "Private Investigations" (1982), "Twisting by the Pool" (1983), "Money for Nothing" (1985), and "Walk of Life" (1985). Their most commercially successful album, Brothers in Arms (1985), has sold more than 30 million copies worldwide; it was the first album to sell a million copies on CD and is the eighth-best-selling album in UK history. According to the Guinness Book of British Hit Albums, as of 2005, Dire Straits had spent over 1,100 weeks on the UK Albums Chart, the fifth-most at that time.

Dire Straits drew from influences including country, folk, the blues rock of J. J. Cale, and jazz. Their stripped-down sound contrasted with punk rock and demonstrated a roots rock influence which emerged from pub rock. The band experienced several changes in personnel, with Mark Knopfler and Illsley being the only members who remained with the band for its entire history. After their first breakup in 1988, Knopfler told Rolling Stone: "A lot of press reports were saying we were the biggest band in the world. There's not an accent then on the music, there's an accent on popularity. I needed a rest." They regrouped in 1990 and disbanded permanently in June 1995, after which Knopfler launched a solo career full-time. He has declined numerous reunion offers, and confirmed in April 2024 that he would never play as part of the group again.

Dire Straits were called "the biggest British rock band of the 80s" by Classic Rock magazine; their 1985–1986 world tour, which included a performance at Live Aid in July 1985, set a record in Australasia. Their final world tour from 1991 to 1992 sold 7.1 million tickets. The band won four Grammy Awards, three Brit Awards (including Best British Group twice) and two MTV Video Music Awards, among various others. They were inducted into the Rock and Roll Hall of Fame in 2018. Dire Straits have sold between 100 million and 120 million records worldwide, including 51.4 million certified units, making them one of the best-selling music artists of all time.

Brothers Mark and David Knopfler were born in Glasgow, Scotland and grew up in Blyth in the northeast of England. With John Illsley and Pick Withers, from Leicester in the East Midlands, they formed Dire Straits in Deptford, south east London, in 1977. Withers was already a 10-year music business veteran, having been a session drummer for Dave Edmunds, Gerry Rafferty, Magna Carta and others through the 1970s. He was the house drummer at Rockfield Studios in Monmouthshire and was part of the group Spring, which recorded an album for RCA Records in 1971. At the time of the band's formation, Mark was working as an English teacher, Illsley was studying at Goldsmiths' College, and David was a social worker. Mark and Withers had both been part of the pub rock group Brewers Droop around 1973.

The new band was initially known as the Café Racers. The name Dire Straits was coined by a musician flatmate of Withers, allegedly thought up while they were rehearsing in the kitchen of a friend, Simon Cowe, of Lindisfarne. In 1977, the group recorded a five-song demo tape which included their future hit single, "Sultans of Swing", as well as "Water of Love" and "Down to the Waterline". After a performance at the Rock Garden in 1977, they took a demo tape to MCA in Soho but were turned down. They sent a tape to DJ Charlie Gillett, presenter of Honky Tonk on BBC Radio London. The band simply wanted advice, but Gillett liked the music so much that he played "Sultans of Swing" on his show. Two months later, Dire Straits signed a recording contract with the Vertigo Records division of Phonogram Inc. In October 1977, the band recorded demo tapes of "Southbound Again", "In the Gallery" and "Six Blade Knife" for BBC Radio London; in November, demo tapes were made of "Setting Me Up", "Eastbound Train" and "Real Girl".

The group's first album, Dire Straits, was recorded at Basing Street studios in Notting Hill, London in February 1978, at a cost of £12,500. Produced by Muff Winwood, it was first released in the United Kingdom on Vertigo Records, then a division of Phonogram Inc. It came to the attention of A&R representative Karin Berg, working at Warner Bros. Records in New York City. She felt that it was the kind of music audiences were hungry for, but only one person in her department agreed at first. Many of the songs on the album reflected Mark Knopfler's experiences in Newcastle, Leeds and London. "Down to the Waterline" recalled images of life in Newcastle; "In the Gallery" is a tribute to Leeds sculptor/artist Harry Phillips (father of Steve Phillips); "Wild West End" and "Lions" were drawn from Knopfler's early days in the capital.

That year, Dire Straits began a tour as opening band for Talking Heads, after the re-released "Sultans of Swing" finally started to climb the UK charts. This led to a United States recording contract with Warner Bros. Records; before the end of 1978, Dire Straits had released their self-titled debut worldwide. They received more attention in the US, but also arrived at the top of the charts in Canada, Australia and New Zealand. Dire Straits eventually went top 10 in every European country.