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Time Step is Kottke's last recording on the Chrysalis label. It is the first of two Kottke albums produced by T-Bone Burnett, the second being My Father's Face. Guests include Albert Lee and Emmylou Harris.

After the release of Time Step Kottke went into a three-year seclusion. When he returned later in 1986, it was as a guest musician on The Blind Leading the Naked by Violent Femmes, then his own releases with a new direction and picking style.