The old Beatles are at left side, standing graveside, mourning their death. Legend is this signified when the Beatles realized they could no longer tour and play live dates. The crowds were too large, the noise was too great even for them to hear themselves playing, and the crazies and stalkers were rearing up.
So from this point forward, the new Beatles - shown front and center in their Sgt. Peppers regalia - became a studio band, safely nestled away in the Abbey Road studios.
Another reason for their departure from the stage. By 1967, the Beatles were creating music that was so electronically complex for the time it could not be reproduced live using the technology of the day.
This was the advent of post-production effects. For example, the rising orchestra-glissando and final chord for "Day In The Life" was produced by all 4 Beatles and George Martin banging on 3 pianos simultaneously. As the sound diminished, the recording engineer boosted to faders. The resulting note lasts 42 seconds, and the studio air conditioners can be heard toward the end as the faders were pushed to the limit to record it.
The rising orchestra-glissando and the thundering sound are reminiscent of "Entry of the Gods into Valhalla" from Richard Wagner's opera "Das Rheingold," where after the rising glissando, Thor beats with his hammer. George Martin said in his 1979 book All You Need is Ears that the glissando was Lennon's idea. After Lennon's death, Martin seems to have changed his mind. In his 1995 book Summer of Love: The Making of Sgt. Pepper, he states that the rising orchestra-glissando was McCartney's idea. (thanks to Johan Cavalli, who is a music historian in Stockholm).
This album cover was created by Jann Haworth and Peter Blake. They won the Grammy Award for Best Album Cover, Graphic Arts in 1968 for their work on this cover.
The celebrities and items featured on the front cover are (by row, left to right):
Sri Yukteswar Giri (Hindu guru)
Aleister Crowley (occultist)
Mae West (actress)
Lenny Bruce (comedian)
Karlheinz Stockhausen (composer)
W. C. Fields (comedian/actor)
Carl Gustav Jung (psychiatrist)
Edgar Allan Poe (writer)
Fred Astaire (actor/dancer)
Richard Merkin (artist)
The Vargas Girl (by artist Alberto Vargas)
Huntz Hall (actor)
Simon Rodia (designer and builder of the Watts Towers)
Bob Dylan (singer/songwriter)
Aubrey Beardsley (illustrator)
Sir Robert Peel (19th century British Prime Minister)
Aldous Huxley (writer)
Dylan Thomas (poet)
Terry Southern (writer)
Tony Curtis (actor)
Wallace Berman (artist)
Tommy Handley (comedian)
Marilyn Monroe (actress)
William S. Burroughs (writer)
Sri Mahavatar Babaji (Hindu guru)
Stan Laurel (actor/comedian)
Richard Lindner (artist)
Oliver Hardy (actor/comedian)
Karl Marx (political philosopher)
H. G. Wells (writer)
Sri Paramahansa Yogananda (Hindu guru)
Sigmund Freud (psychiatrist) - barely visible below Bob Dylan
Anonymous (hairdresser's wax dummy)
Stuart Sutcliffe (artist/former Beatle)
Anonymous (hairdresser's wax dummy)
Max Miller (comedian)
A "Petty Girl" (by artist George Petty)
Marlon Brando (actor)
Tom Mix (actor)
Oscar Wilde (writer)
Tyrone Power (actor)
Larry Bell (artist)
Dr. David Livingstone (missionary/explorer)
Johnny Weissmuller (Olympic swimmer/Tarzan actor)
Stephen Crane (writer) - barely visible between Issy Bonn's head and raised arm
Issy Bonn (comedian)
George Bernard Shaw (playwright)
H. C. Westermann (sculptor)
Albert Stubbins (football player)
Sri Lahiri Mahasaya (guru)
Lewis Carroll (writer)
T. E. Lawrence ("Lawrence of Arabia")
Wax model of Sonny Liston (boxer)
A "Petty Girl" (by George Petty)
Wax model of George Harrison
Wax model of John Lennon
Shirley Temple (child actress) - barely visible, first of three appearances on the cover
Wax model of Ringo Starr
Wax model of Paul McCartney
Albert Einstein (physicist) - largely obscured
John Lennon holding a Wagner Tuba
Ringo Starr holding a trumpet
Paul McCartney holding a Cor Anglais
George Harrison holding a flute
Bobby Breen (singer)
Marlene Dietrich (actress/singer)
An American legionnaire
Diana Dors (actress)
Shirley Temple (child actress) - second appearance on the cover
Other objects within the group include:
Cloth grandmother-figure by Jann Haworth
Cloth doll by Haworth of Shirley Temple wearing a sweater that reads "Welcome The Rolling Stones"
A ceramic Mexican craft known as a Tree of Life from Metepec
A 9-inch Sony television set - the receipt is owned by a curator of a museum dedicated to The Beatles in Japan.
A stone figure of a girl
Another stone figure
A statue brought over from John Lennon's house
A doll of the Hindu goddess Lakshmi
A drum skin, designed by fairground artist Joe Ephgrave
A hookah (water pipe)
A velvet snake
A Fukusuke, Japanese china figure
A stone figure of Snow White
A garden gnome
A euphonium/baritone horn
People who were originally intended for the front cover but were ultimately excluded:
Leo Gorcey - was modelled and originally included to the left of Huntz Hall, but was subsequently removed when a fee of $400 was requested for the use of the actor's likeness.
Mohandas Gandhi - was modelled and originally included to the right of Lewis Carroll, but was subsequently removed. According to McCartney, "Gandhi also had to go because the head of EMI, Sir Joe Lockwood, said that in India they wouldn't allow the record to be printed".
Jesus Christ - was requested by Lennon, but not modelled because the LP would be released only a few months after Lennon's Jesus statement.
Adolf Hitler - was modelled and was visible in early photographs of the montage, positioned to the right of Larry Bell, but was eventually obscured by Johnny Weissmuller in the final image.