Bob Paisley bought 19-year-old Steve Nicol in October 1981 as an eventual replacement for right-back Phil Neal. He cost £300,000 from Ayr United where he had been a part-time player and an out-of-work building labourer. Kenny Dalglish was not so impressed by his arrival: "Until then, the three Scots already at Anfield, Al, Graeme and me had been pretty well able to look after ourselves. We had built up an understanding that the Scots were the master race. We would quote historical facts to the English players to prove it. Some of the most important inventions and discoveries in the world came from from Scots, like television, the telephone, penicillin, the steam engine and tarmac. Not to mention those other wonders of the world, golf and whisky. Everything we had built up, he destroyed in 10 minutes because of the photograph that was taken of him when he signed. There he was with a tammy on, a silly Liverpool scarf and sillier grin. Unbelievable. Stevie was a lovely guy, a real one-off."

Nicol got his first taste of the first team three weeks after arriving at Liverpool in a friendly against an Irish International XI alongside other hopefuls such as Kevin Sheedy and Craig Johnston. He made 26 appearances in the Central league side in his first season in 1981/82 and featured four times for the first team in 1982/83. Nicol emerged as quite a player in the glorious 1983/84 season when Liverpool won the League, European Cup and the League Cup. Phil Neal was not to be moved from the back four, but Nicol slotted in at right midfield. He started 32 out of 67 games and came second in PFA's vote for the Most Promising Player of the Year behind Luton's Paul Walsh. His highlight could have so easily been his lowest point after coming on as a substitute for Johnston and playing 47 minutes in the European Cup final in Rome. He blazed over Liverpool's first penalty in the shoot-out, but thankfully Nicol ended on the winning side. He had still proved his courage in Liverpool's hour of need. Graeme Souness, who was his captain at Liverpool, was very impressed by Nicol. "This lad can play anywhere in the midfield or the back four. He can defend, tackle, he can head the ball, he can take players on and he can score goals and not only would it not surprise me if he eventually finished up in my old position at Liverpool but also I see him as a natural captain, lifting up the trophies for them as well. His only problem is that he is so honest and nice that he is easily wound up - and that can be fatal at Anfield. Stevie let himself in for a ribbing right from the start when he turned up for an away match at the team hotel with a teddy bear on top of his bag which read something like, "I am sad Sam, will you cuddle me and love me and make me happy?"

There are numerous stories on Nicol's "dimwittedness" and David Hodgson knew a couple as he told the LFC Magazine: "The Nic had size-12 feet. And Billy Mercer, a young goalkeeper, was the same size. The older pros used to give the kids the boots to wear in. So Steve gives those boots to Billy, who tries them on and realises the paper’s still in them. He takes the paper out, puts them back on and tells Steve later on that they’re great. ‘You’re joking?’, says the Nic. ‘They just won’t fit me.’" Hodgson added: "Have you heard the one where he stands on the scales with the shopping bags in his hands? Alan Hansen was there, they’d been out. The Nic says: ‘Christ, I’ve put a stone on!’ Hansen’s like: ‘But you’re holding two bags of groceries.’" When Nicol was asked if he wanted to put the record straight on some of these stories he could only confess: "All true, unfortunately. Although, about the weight one, that happened when my wife and I were on a cruise with Alan Hansen and his wife and it happened after a night out, so my marbles weren't all there."

"Chico" is one of the most versatile players football has ever seen. As well as playing on the right side at the back or further up the wing, the genuinely two-footed Scot did an excellent job on the left and also had a successful spell in the heart of the defence when Alan Hansen was hospitalised for the majority of the 1988/89 season. He was a great defender, but also a superb attacking player. He was quite adept at taking on defenders and an accurate crosser of the ball. He scored some brilliant goals and was even top of the goalscoring charts at the beginning of the 1987/88 season, after scoring six goals in his first six League games, including a superb hat-trick against Newcastle which Bob Paisley described as a "masterpiece". Ronnie Moran told LFChistory.net that "Shanks always preached that we had eleven captains. He wanted to see players think things out and rectify things if they were going wrong. I remember Steve Nicol getting a hat-trick once at Newcastle. Nobody told him where he had to go and what to do, he just worked it out himself. He got the match ball and I told him it was probably the only one he'd ever get, but nobody told him off for joining in the attack." Nicol's importance was officially recognised with a Football Writers' Association's Player of the Year award in 1988/89, after filling six different positions that season. Nicol was a regular in Liverpool's first-team for 11 years and retired after 468 matches and 46 goals as a certified club legend.

Nicol had brief spells with other clubs in England with Notts County, Sheffield Wednesday, West Bromwich Albion and Doncaster Rovers before deciding to try his luck across the Atlantic Ocean when offered a player-coach role at the Boston Bulldogs in 1999. Nicol was a lucky man to be alive at that point as he had almost perished at Christmas time 1995 when he was dragged from a freezing lake after plunging through the ice. "I've been getting a bit of stick from the other lads about that," he said shortly afterwards. "But I'd rather be taking the flak than not be here at all!" Nicol enjoyed his new surroundings in Boston that were though a far cry from the hectic English football. "Playing for Boston Bulldogs in front of 700 to 800 fans was obviously different from playing for Liverpool in front of the Kop and 40,000 passionate Reds," Nicol told the Guardian. The Bulldogs served the New England Revolution as its feeder club and when coach Walter Zenga was sacked in 1999, Nicol took temporarily over for the last couple of games of Revolution's season before returning to the Bulldogs in division three of the United Soccer League. Focusing on the coaching rather than running around the pitch at 40 years of age he led the club to the Northern Conference title in 2001 before being appointed assistant coach at the Revolution in January 2002. Four months later coach Fernando Clavijo was sacked and Nicol became caretaker coach seven games in, then hired on a permanent basis and named MLS Coach of the Year as the Revolution reached the MLS final where they lost to Los Angeles Galaxy. After advancing them to three consecutive MLS Cup finals from 2005–2007 their big breakthrough came with the U.S. Open Cup win of 2007, to which they added the North American Superliga title in 2008. In 2010 Nicol failed, for the first time in a league-record eight straight seasons, to guide the Revolution to a playoff berth. After failing again the following year Nicol was sacked as their coach. He is the longest-serving coach with a single club in MLS history with a record of 112 wins, 108 draws and 81 defeats. Nicol said his goodbyes: "I've had some great times and been involved with some great players and great people. My family will always remain part of the Kraft family."

Alan Hansen played alongside Nicol for a number of years and certainly appreciated his compatriot's enormous capabilities. "When I was switched from the left side to the right of Liverpool back four towards the end of my career, when my knee problems had taken their toll on my running, it made me feel I could light a cigar and read a newspaper to have Steve on the outside. His fitness was astonishing. Dietitians would be horrified at the amount he ate. He could eat for Britain. He and I and our families once were on a Norwegian cruise together and he probably consumed more than the rest of us put together. It was not unusual for him to go through six or eight packs of crisps in one go. But he never carried any excess weight, hardly missed a tackle and gave the impression of being able to bomb up and down that right touchline forever. Suffice it to say that after our first match together on the right, I thought, 'Where have you been all my life?'"