McCaughey designed the Minus 5 as a pop collective, and each record the group released featured a new lineup. Throughout these releases, he worked the most frequently with R.E.M.'s Peter Buck, who was featured on the group's eponymous debut EP, which was only released through They Might Be Giants' mail-order record club, Hello Records. By the time they recorded their full-length debut album, Old Liquidator, in 1995, the Minus 5 consisted of McCaughey, Buck, and the Posies' Jon Auer and Ken Stringfellow. After releasing Old Liquidator on East Side Digital, the group reconvened in late 1996 to record its Hollywood debut, The Lonesome Death of Buck McCoy, which appeared in the spring of 1997.

The same year, McCaughey's solo album My Chartreuse Opinion was reissued by Hollywood as a Minus 5 album, and the Minus 5 and the Young Fresh Fellows faced off on a special double-disc split release, Let the War Against Music Begin/Because We Hate You. After a changing of the guard at Hollywood Records, the Minus 5 found themselves back in the independent leagues in 2003, with the Return to Sender label releasing a collection of outtakes from Let the War Against Music Begin called I Don't Know Who I Am before McCaughey signed the band to the Yep Roc label for his collaboration with Jeff Tweedy, Down with Wilco. Yep Roc also issued an EP dominated by Down with Wilco outtakes, At the Organ, and reissued In Rock, a collection of tunes McCaughey recorded in a single day in 2000. The full-length In Rock and the EP At the Organ appeared in 2004, followed by the eponymous The Minus 5 (aka "The Gun Album") in 2006 and Killingsworth in 2009.

Peter Buck had frequently employed McCaughey as a guest musician with R.E.M., and after the band broke up in 2011, Buck recruited McCaughey to help record a pair of solo albums (2012's Peter Buck and 2014's I Am Back to Blow Your Mind Once Again) in McCaughey's personal studio that featured other Minus 5 associates, including Kurt Bloch on guitar and Bill Rieflin on drums. For 2014's Record Store Day, McCaughey compiled a limited-edition, vinyl-only box set of rare and unreleased Minus 5 material, Scott the Hoople in the Dungeon of Horror. In March 2015, Yep Roc Records issued Dungeon Golds, a 12-song collection of highlights from the Scott the Hoople box set.

In August 2016, McCaughey released a new Minus 5 album, Of Monkees & Men, which featured songs paying homage to each member of the celebrated media-made pop group. The album also found the Minus 5 tipping their hats to Monkees songwriters Tommy Boyce and Bobby Hart, the celebrated alt-country band Richmond Fontaine, and actor Robert Ryan. ~ Stephen Thomas Erlewine