Christ Illusion was recorded via computer between two studios: NRG Studios, North Hollywood, with assistant engineer Dave Colvin; and Westlake Studios, Los Angeles, where Brian Warwick assisted. Guitarist Kerry King recalls nine of the eleven songs originally slated for Christ Illusion were demoed in 2004, with Dave Lombardo at the drum kit. However, Lombardo recalls recording with King as far back as early 2003, when two demos were completed at Lombardo's home. In a July 2004 interview, guitarist Jeff Hanneman reported "Me and Kerry have a bunch of songs," and expressed the band's intent to finish the record that year. Slayer's label American Recordings was at the time negotiating a switch of record distributors from Columbia Records to Warner Bros. Records, meaning the recording would have been temporarily shelved until the issue became resolved. For this reason the group did not finish a record at that time, as the distribution deal with Warner Bros. Records was not finalized until late July 2005.
Slayer wished for Reign in Blood producer Rick Rubin to produce the album, and expected him to do so after Rubin expressed an initial interest. Rubin was busy, however, which caused a further delay to recording. While Christ Illusion's recording was finally underway Rubin lent production to Metallica's Death Magnetic, an action later described by King as a "slap in the fucking face." Josh Abraham produced the album instead, and was praised by Blabbermouth's Don Kaye "for capturing much more of the spark than has been apparent on the last few records." Despite missing an opportunity to produce Christ Illusion, Rubin contributed in an "executive production" capacity. King was critical of his involvement, and said he cannot recall Rubin's presence in the studio during the recording, and that Rubin's main contribution was in providing suggestions during the final mix. Jamie Thomson of UK's The Guardian newspaper was scornful of Rubin's contribution, and observed Slayer "seem unwilling to ditch the nu-metal tendencies that have made much of their recent output so resistible, which suggests Rubin's involvement was considerably less hands-on than in his remarkable redemptions of Johnny Cash and Neil Diamond."
As with Slayer's previous two albums, all rhythm guitar tracks on Christ Illusion were laid down by King. Using a Marshall JCM 800 as the main guitar sound throughout the album, King wrote roughly 80% of his guitar solo parts prior to the sessions. The song "Catalyst," meanwhile, almost saw inclusion on Slayer's 2001 album God Hates Us All, existing in an alternative version which features former drummer Paul Bostaph on drums. Lombardo's involvement marked the first time he, King, Araya and Hanneman had appeared together on record since the release of Seasons in the Abyss in 1990, a reason cited by guitarist Jeff Hanneman for an alleged clearer punk vibe throughout the songs on the album. Lombardo personally described the album as "a matured Reign in Blood", while King described it as "a mix between God Hates [Us All] and Seasons [in the Abyss]."
Although eleven songs were originally slated for the album, only ten made the final track listing. A song penned by Hanneman, entitled "Final Six," was meant for inclusion, with the song name originally declared as the album's title by vocalist Tom Araya to George Stroumboulopoulos of CBC's The Hour. Questioned about the album's title by Kevin and Bean of Los Angeles KROQ-FM, King replied "I'm not positive it's been nailed yet. I think last week was the deadline and I'm not sure where it ended up, so I'm gonna have to take the fifth on that one. The way it was going, my vote was overlooked, so… That's why I'm not real thrilled about it." However, Araya took one weekend off for vacation during the recording of the album and required a two-hour gall bladder operation the following Monday on May 5, 2006. Thus, he was unable to finish the vocals for the song in time for the album's release. King hinted "Final Six" might appear on a special digipack release of Christ Illusion: a release which eventually surfaced in July 2007. "Final Six" also appeared on the soundtrack to the film Punisher: War Zone the following year.