After having toured the "A.O. Mod. TV. Vers." album, WEA demanded another album. The third album, "Xenophobia", was written and recorded in just six weeks, the title inspired by race issues surfacing in the lead-up to Australia's upcoming Bicentennial year. The album released in March 1988 peaked at No. 15 in Australia, it was produced by Karski and Guy Gray and released by WEA in 14 countries. The album provided three singles, "Forget about the Working Week", "Clarity of Mind" and "Waiting". During this time the band played smaller shows to dedicated fans in Sydney under the pseudonym The Drug Grannies.