Happy Sad 
Buckley's third album saw him move away from the folk-rock sound he had begun his career with and enter new, uncharted territories. Happy Sadfeatured an interesting instrumental lineup with more in common with jazz than folk or rock - Buckley's acoustic 12-string guitar was backed by Lee Underwood's electric Telecaster guitar, John Miller's stand-up bass and David Friedman's vibraphone and marimba.
With the songs all clocking in at over five minutes (and two over ten minutes), he gave these excellent musicians plenty of room to improvise, resulting in a fantastic jazz-folk sound - laid-back and dreamy, the perfect accompaniment to his vocals. He also began to make even greater use of his splendid vocal range, using his voice as an instrument, and his songwriting took on more abstract themes (for the most part abandoning the traditonal verse/chorus song structure).
Interestingly this was the first time a Tim Buckley album included nothing but solo compositions, as before most of his songs had been collaborations with lyricist Larry Beckett.
All these factors added up to create a brilliant album, which marked Buckley out as a truly exciting singer-songwriter, unburdened by the conventions of pop music or the restrictions of genre.