In the spring of 1987, Paul E. Dangerously formed The Dangerous Alliance with Adrian Adonis and The Original Midnight Express (Dennis Condrey and Randy Rose) in the American Wrestling Association (AWA).
In October 1987, Dangerously successfully led Condrey and Rose to win the AWA World Tag Team Championship from Jerry Lawler and Bill Dundee, only to lose the titles to The Midnight Rockers (Shawn Michaels and Marty Jannetty) two months later. Dangerously also helped Adonis in his feud with Tommy Rich and his bid to win the AWA International Television Championship, in which Adonis lost the title in a tournament final to Greg Gagne. By 1988, the Dangerous Alliance disbanded, as Dangerously, Condrey, and Rose left the AWA.
After Dangerously was "fired" as an announcer for World Championship Wrestling 1991, the precursors to resurrecting his stable came at the Halloween Havoc pay-per-view in Chattanooga, Tennessee. Prior to the show, announcer Eric Bischoff was working as a valet in the parking lot. When Dustin Rhodes and Barry Windham pulled up and got out of their car, Arn Anderson and Larry Zbyszko ran up to Bischoff and Windham and slammed the car door on Windham's hand, breaking it. It was from this incident that Zbyszko gained his nickname from around this time, "The Cruncher".
Later at the same show, the mysterious WCW Halloween Phantom appeared, and squashed Tom Zenk in a match using a reverse neckbreaker. Then, in an interview segment with Bischoff, Dangerously brought out the Phantom and had him unmask to reveal the returning "Ravishing" Rick Rude. Dangerously stated that even though he had been fired as a commentator, he still had his manager's license, and would use Rude to exact his revenge on the company that fired him.
The storyline was furthered at Clash of the Champions XVII on November 19, 1991 in Savannah, Georgia. At the beginning of the Clash, WCW United States Heavyweight Champion Sting was in the ring doing an interview. Madusa came out dressed as a harem girl and distracted Sting so WCW World Heavyweight Champion Lex Luger could attack him from behind by clipping his knee, the same one Sting injured in February 1990. Luger then bashed the knee against the runway repeatedly to make it seem like Sting had suffered severe damage. Several wrestlers, including Bobby Eaton, ran out to run the heel Luger off and take Sting to the hospital. Sting, however, had to defend his title against Rude that night and did not want to leave. Eaton kept telling him he would have time, so he left. Bischoff rode in the ambulance with Sting and gave live updates on the condition of Sting from the hospital between matches to announcers Jim Ross and Tony Schiavone. Meanwhile, Dangerously had found a loophole in the match contract that specifically stated that if Sting was not able to defend his title, he would have to forfeit it to Rude. The announcers relayed the message to Bischoff, who in turn passed it along to Sting. Commotion could be heard in the background as Sting tried to leave the hospital and return to defend his title.
When it came time for the match, Sting was a no-show and Dangerously declared Rude the United States Heavyweight Champion (which had been their plan all along). The telecast featured a split screen of the ambulance arriving at the back area of the arena with Sting's knee wrapped up. Dangerously demanded referee Nick Patrick start the match and count Sting out, but he kept interrupting the count which allowed Sting enough time to make it out to the ring. Rude met him at the runway with punches but Sting was so pumped he took it to him instead and the match was underway. Rude defeated Sting, mainly due to his injured knee, with a small package pin. On the following episode of World Championship Wrestling, Dangerously formed his group with Rude, Eaton, Madusa, Arn Anderson, Larry Zbyszko and "Stunning" Steve Austin.
The Dangerous Alliance went on to dominate WCW for the next six months, as Anderson and Eaton won the WCW World Tag Team Championship and Austin held the WCW World Television Championship for a time. Their main feuds were with Sting, Ricky Steamboat, Barry Windham, Dustin Rhodes, and Nikita Koloff. The Alliance and its rivals went back and forth until they settled their issues in a gruesome "WarGames" match at WrestleWar. During the match, Rude removed the turnbuckle from the post; Zbyszko tried to hit Sting with the metal hook, but ended up hitting his stablemate Eaton instead, allowing Sting to apply an armbar to Eaton and garner a submission victory for his team. After the match, Zbyszko was expelled from the Alliance, which began the group's downfall.
Rude and Madusa went their own separate way and had much success. Anderson and Eaton started running with Michael Hayes, but they came back to Dangerously when he fired Madusa publicly at Halloween Havoc in October and she came after him. By the end of November 1992, after the Clash of the Champions XXI, the Dangerous Alliance had disbanded after Dangerously left the company.
Dangerously revived the Dangerous Alliance in Extreme Championship Wrestling in 1993, with Jimmy Snuka, Don Muraco, The Dark Patriot and "Hot Stuff" Eddie Gilbert. On the October 19, 1993 episode of ECW Hardcore TV, Paul Heyman introduced a new Dangerous Alliance featuring ECW Heavyweight Champion Shane Douglas and Sherri Martel as Director of Covert Operations. By August 1994, Dangerously formed the last incarnation of the Dangerous Alliance composed of The Tazmaniac, Sabu, and 911. Tazmaniac and Sabu wound up winning the ECW World Tag Team Championship in February 1995, before losing the titles three weeks later. In April 1995, Sabu was fired by Dangerously. In July 1995, The Tazmaniac, now under the name Taz, suffered a serious neck injury during a tag team match in Florida. With Sabu fired and Taz injured, Dangerously finally disbanded The Dangerous Alliance.