In 1958, Contemporary Records founded a new jazz label, Stereo Records, for stereo technology records. Stereo Records releases have the word "STEREO" in a white oval on the front cover. The Stereo Records S7000 series was active from 1958 to 1960, and had black labels with gold text. Stereo record releases later reverted to the Contemporary Records label (Contemporary S7500 series).

They offered their first six releases in May 1958. Their sound engineer Howard Holzer felt it was a compromise to make them "compatible" so he designed and built a special lathe using double channels in order to use the Westrex 45-45 "StereoDisk" cutter.