In 1996, six years after she had topped the pop charts with Show Me Heaven , Maria McKee wrote a long, elaborate suicide note. “I’d been in a relationship that had turned into a tortuous situation,” she recalls. “I was rapid-cycling bipolar and I was through with the music business.” This note was no “goodbye cruel world”, however, but a dozen new songs, and when she took what she’d written to her record label, Geffen, executives were horrified. Thus the greatest lost masterpiece of 1990s rock, the album Life Is Sweet , was born.

Unfortunately, it sank almost without trace. The rock critic at the Los Angeles Times slated it (“It was as if I’d gone round to his house with an Uzi and shot up his walls”) and People magazine voted it the worst record of the year. McKee could have filled the space vacated by Kurt Cobain, but if you know her at all it’s probably for the MOR Show Me Heaven . Or writing Feargal Sharkey’s A Good Heart . Perhaps then you might think about her solo career. “Wait,” she interrupts, “don’t you think the fact I was in Lone Justice in the 1980s would be third on that list?”

April 2007 finds McKee at home in Los Angeles, preparing for a British tour. The house is a hive of activity, with transatlantic phone calls to book accommodation, transport and musical equipment. Rehearsals have to be organised with the band that will be touring her latest album, Late December . “ Life Is Sweet got me off Geffen and we’ve been indie ever since,” she says. “Jim, my husband, does everything. He produces and engineers the albums, plays a lot of the instruments, does the photography, runs the label, manages me and leads the band. It’s crazy, but I’d been jerked around my whole career and he’s the first person I can defer to, knowing he’ll have the answer.”

That McKee is still in the music business after so much went awry in her career should come as no surprise. It’s in her blood. Her family were circus folk, her half-brother, Bryan MacLean, was in Love in the 1960s, and her hippie-beatnik parents would take their three-year-old daughter to the Whiskey a Go Go to see him play. Among her earliest memories are watching the Doors, witnessing the caged dancing girls and being introduced to Frank Zappa.

MacLean was convinced that his sister should become a singer and that he could control her career, but his plans foundered when she put together her own garage band. A quarter of a century later, with Americana a recognisable country-rock blend, Lone Justice might have stood a chance as a credible act, but in 1982 there was only one selling point. The hype put behind the band’s jailbait singer was such that even reading about them felt sleazy. Anyone could see that this was corporate rock of the most blatant sort.

The weight of spin was crushing the band right from the word go. “I was 18, 19 and our manager was bringing Stevie Nicks and Bob Dylan round to the studio; everybody was fawning over me. Dave Stewart was proposing marriage every week, Bono was bouncing me on his knee and Bob Geldof was writing me poetry. It was crazy, so 1980s.”

The original band bailed out, new musicians turned up. The night before a date supporting U2 at Madison Square Garden, Bono dropped the bomb. “He said: ‘I don’t understand, this isn’t the band I saw. You were these punk kids and it was all so fresh, what you need to do is fire everybody.’ I had several quite traumatic breakdowns on that tour.”

Going solo should have meant a fresh start, but too many people wouldn’t let Lone Justice die. America (and, peculiarly, France) had taken them to heart and turned their back on the solo McKee. After two albums in a similar country-soul vein, she delivered Life Is Sweet and bade farewell to the person everybody thought she was. Even at a decade’s remove, it is still magnificent, filled with everything that makes great rock’n’roll. The sound is either cavernous or claustrophobic, McKee’s frustration boils over throughout and one of the best pop voices simply screams at the world, her wonky yet coruscating guitar a second angry voice. It lost her a recording contract and culled her fanbase but brought her freedom. It’s no longer available in America. As a result, McKee is now three albums into an independent career that has demonstrated exactly how fulfilling freedom can be. High Dive was almost as challenging as Life Is Sweet , as fun Springsteenesque rock songs collided with elaborate operettas that demonstrated a love of Stephen Sondheim. Peddlin’ Dreams went back to her country roots, but in a rewarding, stripped-down way.

Late December is a slight return to the art rock of Life Is Sweet , with her own version of A Good Heart a reminder that she has been in the business for 25 years, starting as the future of rock’n’roll and ending up a cult. She had everything and threw it away: Where did it all go wrong?

“Where did all what go wrong?” She seems genuinely shocked that anybody could ask this question. “I’m lucky. If I hadn’t gone through what I did I’d never be able to make the music I do now. I’d be toiling away in obscurity, I wouldn’t have this freedom. I’m really grateful. I’m never going to be rich and famous, but who knows if that’s the best thing in the world?” Late December (Cooking Vinyl) is out on Monday.

McKee’s UK tour starts on Monday at Bush Hall, WC2 (020-8222 6955)

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