On November 11, 2011, it was revealed that Vampire Weekend had been in the studio, writing and recording material for their third album. On April 26, 2012, Rolling Stone reported that the new album could be released by the end of the year. Koenig said, "We do have a ton of stuff. It would be cool if it was [released] this year...We just never want to be in a position [where] when we put out something, we feel could've benefited from more time." Until its release, the band was discreet about the details of the next album, stating that a band "can give a bunch of interviews when they're working on stuff" but they "don't want something [they] said six months ago to influence how people hear it when it's done."  Modern Vampires of the City was released in May 2013, and written and recorded in various locations including SlowDeath Studios in New York, Echo Park "Back House" in Los Angeles, Vox Recording Studios in Hollywood, Rostam Batmanglij's New York apartment and a guest house on Martha's Vineyard. The album was co-produced by Batmanglij and Ariel Rechtshaid. After Batmanglij produced the first two albums himself, this marked the first time the band worked with an outside producer on any of their records.  In an interview for the February 2013 edition of Q (released in mid-January), Koenig described the upcoming album as "darker and more organic" and "very much the last of a trilogy". Says Koenig, "Things that we might have found boring in the past, we've started to find more fresh. This album has more piano and acoustic guitar and organ." Modern Vampires of the City also marks the band's first use of digital voice modulation, as heard in the songs "Diane Young" and "Ya Hey." (first use was actually in the song "California English" on the Contra album)  The album was recorded and co-produced by Ariel Rechtshaid in his Los Angeles Studio (alongside Batmanglij). The band discussed the album with The FADER and appeared on the cover of the magazine's 84th issue. On March 16, 2013, the band played the closing show at Stubbs on the last day of the SXSW festival in Austin, Texas. In the show they played two new songs from the upcoming album: "Diane Young" and "Ya Hey". On March 18, 2013, Vampire Weekend released a double-sided single, "Diane Young"/"Step". On May 11, 2013, Vampire Weekend were featured as the musical guest on Saturday Night Live with Kristen Wiig hosting, their third time on the show.  Released on May 14, 2013, the album debuted at #1 on the Billboard chart, marking the second time Vampire Weekend has achieved the feat: its second album Contra also debuted at #1 in 2010, making this the first time an independent rock band has entered at #1 with two consecutive releases. Modern Vampires of the City also shattered the previous record for first week vinyl sales, moving nearly 10,000 units on vinyl alone and debuting at #1 on the Soundscan Vinyl Charts. Additionally, the band charted #1 at Indie, Alternative, Digital and the top 200. In 2014, Modern Vampires of the City won a Grammy for Best Alternative Music Album.

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Rolling Stone reported that the new album could be released by the