In 2005, Type O Negative left Roadrunner Records. Steele had never been happy with the conditions of the recording contract and had described it as "a millstone around my neck". Steele alleged that Type O Negative's split from Roadrunner Records, aside from a poor offer, had to do with an unauthorized release of a "best of" compilation. Steele remained on friendly terms with the staff at Roadrunner Records and in October 2005 he appeared on the Roadrunner United album to help celebrate the label's 25th anniversary.
There were unconfirmed rumors at one point of Steele's death after the band website posted an image of a tombstone bearing his name and the dates 1962–2005. According to an article dated May 14, 2005, Steele was not dead; the gag was related to their fresh signing with SPV Records. The website discontinued the tombstone picture in October 2005.
During 2005, Steele disappeared for an extended period with no explanation. Rumors of his death, terminal illness, and other speculations increased until the mystery was dispelled in an interview on the 2006 DVD Symphony for the Devil. In the interview Steele briefly mentions his incarceration in Rikers Island and "the psych ward at Kings County Hospital". Steele's family members had staged an intervention and insisted he check into a mental institution. Steele later confirmed he had been suffering from paranoia caused by his heavy substance abuse. Steele had been using cocaine since the age of 35, a decision he expressed great regret about. Steele then attended rehab for cocaine dependence and alcoholism, and later served a 30-day prison term for assaulting a love rival. Steele made light of his incarceration by wearing a prison uniform on stage during live performances.