His third album, 1975's Nighthawks at the Diner, was designed to show off Waits as an entertainer as well as a tunesmith; producer Bones Howe set up a nightclub facsimile in a recording studio, paired Waits with a solid band of jazz-inclined studio musicians, brought in an audience, and recorded what was in essence his first live album. As entertainment, Nighthawks at the Diner is one of Waits' most thoroughly enjoyable albums. He's clearly jazzed by the presence of an audience, and his skills as a storyteller are marvellous.

Much like Lou Reed's Live: Take No Prisoners, this is an album where the between-song patter sometimes outshines the songs, and there's no arguing that Waits is a very funny guy who plays brilliantly to a crowd, spinning eccentric, evocative tales of life on the bad side of town that make it all sound like a ball. The band is excellent, too; bassist Jim Hughart, drummer Bill Goodwin, pianist Mike Melvoin, and sax player Pete Christlieb give Waits the ideal three-a.m. ambience to bring the songs to life.

- AllMusic.com