DreamWorks Records (often referred in copyright notices as SKG Music, LLC) was an American record label founded in 1996 by David Geffen, Mo Ostin, his son Michael Ostin and Lenny Waronker as a subsidiary of DreamWorks Pictures. The label operated until January 9, 2005, when it was sold to Universal Music Group. The label itself also featured a Nashville, Tennessee-based subsidiary, DreamWorks Nashville, which specialized in country music and was shut down in 2005 then moved to MCA Nashville. The company's logo was designed by Roy Lichtenstein and was his last commission before his death on September 29, 1997. DreamWorks Pictures's DreamWorks Records catalogue is managed by Music Corporation of America, while its DreamWorks Nashville catalogue is managed by MCA Nashville.

In October 1994, four years after David Geffen sold his former record label Geffen Records to MCA Music Entertainment, he joined Steven Spielberg and Jeffrey Katzenberg to form DreamWorks Pictures (also known as DreamWorks SKG). SKG stood for Spielberg, Katzenberg & Geffen. Geffen was still contracted to the now MCA-owned Geffen Records at that time, but stood down in April 1995. The three partners later launched the subsidiary record label DreamWorks Records in early 1996. Geffen focused on the music division of DreamWorks, with the live-action film division being handled closely by Spielberg, and Katzenberg focusing on the animated film division. Geffen recruited experienced music industry figures for DreamWorks Records, including Mo Ostin and his son Michael, and Lenny Waronker. The label was presided over by Waronker and Mo Ostin – who ran Warner Bros. Records until the mid-1990s – and Michael Ostin, who served as the president of DreamWorks Records. Mo Ostin stated at the time: "what you find in the record business is there is more and more a trend toward corporate control, corporate values, and here you’re dealing with a creatively oriented operation."

Canadian singer-songwriter Rufus Wainwright was the first artist to be signed to the new record label, in early 1996. Another early signing, George Michael, joined the label after a legal dispute with Sony Music Entertainment. As part of the settlement with Sony, they allowed future Michael albums to have US/Canadian distribution by the new DreamWorks Records label, with international distribution going to Virgin Records. Wainwright later noted that he and Michael, two of the label's earliest signings, were both homosexual, with label founder Geffen himself being homosexual. The logo for the label was the last project completed by artist Roy Lichtenstein. The distinctive design, incorporating a musical note in the artist's trademark "dream balloon," debuted on the packaging for Beautiful Freak, the first album from Los Angeles-based band Eels, and the second release from the record company. The record label's first release, George Michael's Older album, had featured DreamWorks' more well-known logo of a boy fishing and sitting on a moon crescent. This moon logo has been used for non-music divisions of DreamWorks, and was later turned into a 25 second long CGI opening logo, when the main division DreamWorks Pictures began releasing films in late 1997.

Henry Rollins (both as a spoken-word artist and with Rollins Band), Alien Ant Farm, comedian/actor Chris Rock, Elliott Smith, Jimmy Eat World, Morphine, Nelly Furtado, Papa Roach, Powerman 5000, Sleepy Brown, rapper Swizz Beatz, Tamar Braxton and The All-American Rejects were among some of the notable acts signed to the label in the 1990s and early 2000s. Film composer Randy Newman was signed to the label as a composer of original non-film related music, although his film score work for DreamWorks Pictures films would later be released by the label as well. By the time the first DreamWorks Pictures film The Peacemaker was released on September 26, 1997, the label had released 12 albums by George Michael, Eels, Jonathan Larson, Powerman 5000, Morphine, Rollins Band, Chris Rock, Kool Keith, Forest for the Trees, Subcircus, Kim Fox and Hans Zimmer, with the Hans Zimmer album being a soundtrack score for The Peacemaker (released two weeks prior to the film). Jonathan Larson died in 1996 and was never officially signed to the label. The album of his that DreamWorks released consisted of cast recordings related to his gay-focused Broadway musical Rent. The album was successful for DreamWorks, and a second version would be released in 1999, titled The Best of Rent: Highlights from the Original Cast Album. Rent was eventually turned into a live-action film in 2005, although this film was released by Sony's Columbia Pictures, rather than by DreamWorks Pictures. Powerman 5000 had Rob Zombie's brother Spider One on vocals, and their DreamWorks debut Mega!! Kung Fu Radio was a reworked version of their independent debut The Blood-Splat Rating System, featuring a revised track listing and two new songs. Mega!! Kung Fu Radio was released on February 25, 1997, making them the first hard rock/metal act to release music for the label. The album had more of a funk and rap influence then their 1999 follow-up Tonight the Stars Revolt!, which is noted for its electronic-leaning sound. That album went platinum for sales of over 1 million copies, whilst Mega!! Kung Fu Radio had sold only 156,954 copies by November 2003. New York singer-songwriter Kim Fox was the first female artist signed to the label, and her debut Moon Hut was recorded with local musicians in Bloomington, Indiana, being released on September 9, 1997. It received positive reviews from critics for having a more experimental and irreverent approach to the female singer-songwriter genre, but was not commercially successful, with her subsequent album in 2003 being released independently.

In the lead up to the March 25, 1997 release of Rollins Band's DreamWorks debut Come In and Burn, lead singer Henry Rollins and DreamWorks Records had been involved in a lawsuit with Rollins Band's previous label Imago. At the time, the independent Imago had lost its distribution deal with major label BMG, leading Rollins to seek another label, with Rollins later being approached by David Geffen and other DreamWorks representatives to join their new label. Shortly after Rollins signed to DreamWorks, Imago president Terry Ellis filed a multi-million dollar lawsuit against both Rollins and DreamWorks, alleging breach of contract. Imago argued Rollins was still obligated to deliver more albums, under an eight-album deal Rollins Band had signed in 1991. Rollins countersued, claiming fraud and deceit on Imago's part. Rollins believed that the contract was no longer valid due to Imago's financial instability and loss of major label backing, saying that the label would soon go out of business. The lawsuit was still ongoing by the time Come In and Burn was released.

Once DreamWorks Pictures launched in September 1997, the label started doing soundtrack compilation tie-ins (usually with several songs from artists signed to their label), including for the DreamWorks films Almost Famous, American Beauty, Forces of Nature, Road Trip, Shrek, Small Soldiers and The Prince of Egypt. Additionally, between 1998 and 2000, the label released soundtrack compilations for three non-DreamWorks films; Dead Man on Campus, A Night at the Roxbury and The Ladies Man. All three of these films were comedies owned by Paramount Pictures, who later acquired the rights to the live-action DreamWorks film library in February 2006. The Dead Man on Campus soundtrack included songs from the DreamWorks artists Self, Propellerheads, Powerman 5000, Jonathan Fire*Eater and Creeper Lagoon, although the soundtracks for A Night at the Roxbury and The Ladies Man consisted of songs from non-DreamWorks artists. On September 8, 1998, the label released Songs of the Witchblade: A Soundtrack to the Comic Books, which, unlike typical soundtracks tied to film or television, was created specifically as a musical companion to the indie comic book Witchblade. The idea behind the project was to produce a set of songs that capture the mood, atmosphere, and character dynamics of the comic, functioning as a concept album that follows the tone and themes of Witchblade rather than telling a linear story. Kat Bjelland from Babes in Toyland (a non-DreamWorks act) was influential in putting the album together, as she was a fan of the comic. It featured only two songs by artists signed to DreamWorks; Kim Fox and Subcircus. On September 18, 2001, the label also released WWF Tough Enough: Music From the Hit Series, which was for the wrestling reality show of the same name. This compilation featured several songs from hard rock/metal artists signed to DreamWorks – including Alien Ant Farm, Buckcherry, Halfcocked, Papa Roach and Pressure 4-5 (who still had not released their debut Burning the Process yet). The show itself aired on MTV, which like Paramount was part of Viacom, and it had no corporate ties to the non-music divisions of DreamWorks.

In addition to using their songs on soundtrack albums, DreamWorks further promoted their musicians by using their songs within DreamWorks films. Two notable examples include the Oscar winning picture American Beauty, which featured the Eels' song "Cancer for the Cure" and Elliot Smith's song "Because", and DreamWorks' most successful release Shrek, which featured the Eels' song "My Beloved Monster" and the Self song "Stay Home". Eels' music also appeared in the DreamWorks films Road Trip and Shrek 2, while Smith's music additionally appeared in Almost Famous. Other DreamWorks films with songs from artists signed to their label included Evolution (which used songs from Buckcherry, Powerman 5000 and Self). Small Soldiers used Edwin Starr's 1970 song "War", while the soundtrack album released by DreamWorks Records featured a cover of "War" by Henry Rollins. He did this cover as part of a collaboration with Bone Thugs-n-Harmony and other musicians, rather than as part of Rollins Band. In Small Solidiers, there is also a scene in the protagonist's bedroom which shows a poster for Powerman 5000's Mega!! Kung Fu Radio.

After releasing The Peacemaker score in 1997, the label would occasionally release other background scores for DreamWorks films, including Randy Newman's score for Meet the Parents, Thomas Newman's score for American Beauty, Harry Gregson-Williams' score for Sinbad: Legend of the Seven Seas and John Williams' scores for Amistad, Catch Me If You Can, Minority Report and Saving Private Ryan. American Beauty was the only film to receive both a soundtrack score album and a soundtrack compilation album with songs from various artists. Certain DreamWorks scores were released by outside labels, starting with Mouse Hunt, which had its score released by Varèse Sarabande on December 2, 1997.