After touring with Ozzy Osbourne in support of the Ultimate Sin album, Lee was fired in a telegram from Sharon Osborne while working on one of his muscle cars back in Los Angeles. Lee was completely caught off guard at the time of his firing as he was under the impression he had a solid working gig with the Osborne camp. Wishing to distance himself as much as possible from his former boss, he set about looking for a charismatic front man with which to launch a new band. He found just that when he met Ray Gillen, a struggling vocalist who had just been separated from Black Sabbath after a short time. Within weeks, the duo had enlisted bassist Greg Chaisson and Gillen's former Black Sabbath bandmate Eric Singer on drums.
The band released Badlands in June 1989 to good reviews. The band released videos for the songs "Dreams In The Dark" and the Zeppelin-like "Winter's Call", and both enjoying decent airplay on MTV. This boosted the album to its peak on Billboard's album charts at no. 57.
Eric Singer soon quit Badlands and later joined Paul Stanley's solo club band which later earned him a new job with KISS following the death of drummer Eric Carr. Badlands picked up Jeff Martin, former vocalist for Surgical Steel and Racer X to take over on drums, and the band released Voodoo Highway in 1991. However, Badlands was slowly breaking apart at the seams. During the recording process, Lee accused Gillen of conspiring with their label to push the band in a more commercial direction. This subsequently led to Gillen being fired. However, since a tour of the UK had already been booked, the vocalist was temporarily re-admitted for its completion. Unfortunately, this wasn't well-publicised in the UK press and the tour attendance was possibly affected.
Decline and breakup
While Voodoo Highway was being recorded and produced, band tensions began to rise. The band also refused to co-operate with Atlantic Records, who demanded a songwriter (Desmond Child) be hired to help write songs with the band. Lee refused and stated "They'd rather make money touring than releasing an album they did not believe in". Meanwhile, Gillen had been writing his own material that the band could supposedly use and had called Atlantic to tell them he had three or four songs ready that all had potential to be hits. However, the band had other ideas and refused to record them. Gillen called Atlantic again and told them that the band were not interested and that they needed to pressure the band into recording the songs. The band continued to refuse claiming the songs were of an average standard. The band was subsequently dropped from Atlantic after the album was released. After the dispute of the material Gillen had recorded, he quit the band claiming that Lee was a lazy musician, unlike his former band mate Tony Iommi. Lee hired Debby Holiday to replace Gillen on their UK tour. However, Gillen was drafted back in to complete the tour before finally exiting the band.
After Gillen left the band and announced his replacement, Lee was contacted by Kerrang! magazine to talk about the new vocalist. The majority of fans and listeners were still shocked at the news that a female soul singer had been chosen to replace Gillen. The interview with Lee was published in issue #399 and readers were shocked at the speed at which Lee and Gillen's friendship had fallen apart. Lee talked only briefly about Gillen's replacement and much of the article was based on Gillen's erratic behaviour. He also raised over Gillen's personal life. In issue 401, Gillen responded by addressing many of the points that Lee had made claiming them to be falsified or exaggerated. He spoke of the reason he had returned to the band and proceeded to call Lee a lazy musician and claimed Lee "couldn't wear Van Halen's socks, because if he could, we'd be writing good songs". He also talked briefly of his future endeavours.
On Thursday, July 2 the band played at the London Astoria. Just a few songs in, Gillen pulled out a copy of the Kerrang! magazine that had been released with Lee's story in it and shouted to the crowd "there's two sides to every story" while Lee stood there and mouthed "Its all true". Questions were being raised whether the band would continue or whether Gillen and Lee would fight it out on stage there and then. However, the band did continue and played the rest of its set.
In Kerrang! issue #400, Neil Jeffries reviewed the gig and claimed that he had never seen a band with so much tension play so superbly. He praised Lee's guitar work and claimed the band were absolutely superb despite their obvious feuds.