Luckenbach's association with country music began in the summer of 1973, when Jerry Jeff Walker, backed by the Lost Gonzo Band, recorded a live album there called Viva Terlingua atLuckenbach Dancehall. That album became an outlaw country classic. Four years later (and a year after Crouch's death), Waylon Jennings and WillieNelson memorialized Luckenbach with the song "Luckenbach, Texas (Back to the Basics of Love)," cowritten by rock and soul producer Chips Moman and keyboardist Bobby Emmons.

Luckenbach hosts a wide range of visitors for live music events each weekend, including bikers, bankers and everyone in between, with a separate area for motorcycle parking and car parking, usually in the grass. On Sundays, it is common for people to bring instruments and those in the crowd entertain each other, taking turns performing under the trees just outside the bar. No hard liquor is allowed, and no law enforcement is necessary as the crowd tends to self-police.