The beautiful and damned: The shocking suicide of the art world's most glamorous couple

On a hazy Sunday morning in July, a fisherman off the coast of Sea Girt, New Jersey, spotted something in the water he took to be flotsam but quickly saw was a body. Sea Girt isn't the kind of place that does bodies much. A town of two thousand people, clapboard houses and a lighthouse, it is famed locally for its clambakes. The fisherman called the coastguard at Point Pleasant Beach and the corpse – naked, swollen, faceless – was taken quietly away. It bore no scars or tattoos, no signs of violence. All that could be said was that the body was male, white, and brown haired.

Five days earlier, it had been Jeremy Blake: 35 years old, 6ft 2in, beautiful; a talented artist on the point of becoming a famous one. On that day, 17 July, Blake had walked from a New York office to the subway station at Union Square and taken the L train to Far Rockaway Beach. There, at 102nd Street, he undressed, left his clothes under the boardwalk and swam out to sea. A woman called 911 to report a bather in trouble, an NYPD scuba team was sent out. But Blake was gone. His body floated south, at seven miles a day, until it arrived off Sea Girt.

A week before, he had gone home to his East Village apartment at 11th Street and Second Avenue to find his partner, Theresa Duncan, dead of an overdose of Tylenol. Like Blake, Duncan had everything to live for. Blonde to his dark, she was as beautiful as he was. She was also as clever: the curator and longtime Blake fan, Jonathan Binstock, recalls that she seemed to know about everything. "I was never outright scared of her," he says, mildly, "but she was definitely a force."

Duncan's internet blog, The Wit of the Staircase, had a small but smart cult following. Her video games, made for young girls, were hugely successful: the Washington Post called Chop Suey, a game narrated by David Sedaris, "one of the finest stories-on-CD, ever." She had collaborated with the well-known artist Karen Kilimnik on a short animated film, a fashion world "mockumentary" called The History of Glamour, shown at the 2000 Whitney Biennial. And, above all, Theresa Duncan had Jeremy Blake. She claimed that she and Blake hadn't spent a night apart in the 12 years they were together. So inseparable were they that the hip website, artnet.com, snidely dubbed the pair "theremy".

Now, in a week, Duncan and Blake were dead, each by their own hand.

Sitting in his Manhattan office, Malcolm McLaren winces and says, "I'm only talking to you about this because I don't understand what happened." Then the man who invented punk goes uncustomarily quiet.

Actually, the silence is a relief. For an hour, McLaren has talked unstoppably about Blake and Duncan's double suicide, his voice rising in exasperation. "I met Theresa first, in the late 1990s," he says. "She was just about to venture off to Hollywood and her agent wanted me to meet her. I knew nothing about her, but I found her vivacious, full of herself. Incredibly self-confident, but also innocent about the world she was getting herself into. There was a touch of hysteria to her. If you were ever even faintly critical, she would explode. So I didn't go there."

At the time, Duncan had just finished making The History of Glamour with Kilimnik. "The title told you everything you needed to know about Theresa and Jeremy," McLaren says. "Glamour was what they were about, and Hollywood was where they were going to find it. She had an idea for a movie, a fashion-driven, coming-of-age story called Alice Underground. The unexpected thing about Theresa, though, was her mind. For all her youth-culture thing, when she spoke she had real curiosity. She was intellectually driven."

By contrast, according to McLaren, Blake was much the less confident of the two. "I liked him a lot," McLaren says, "but he always struck me as a troubled person. Everything that's been written about them since it happened has suggested that Theresa was the crazy one. But actually I don't think she was all that crazy. I think it was the other way around."

Flick through the American press and you'll see what McLaren means. The orthodox version of the Blake-Duncan story goes like this. When Duncan met Blake – at a concert of the US punk band, Fugazi, in 1994 – she had just started a job at at the hip digital agency, IconNicholson. Chop Suey, made while she was working at Magnet Interactive in Washington, had just been picked by Entertainment Weekly as its game of the year. Duncan had a style of her own: tartan tights, sequinned miniskirts, glam-rock. By contrast, Blake – five years younger and newly graduated from the California Institute of the Arts in Los Angeles – was working as a photographic re-toucher in New York. Duncan was going places while Blake was geeking around on computers, wondering which direction his art should take.

Sequins apart, though, Duncan's life was less shiny than it looked. For one thing, her move from Washington to New York hadn't been voluntary. After the success of Chop Suey, she had pitched another game to Magnet, set in the Deep South and called Shoo-fly Pie. When a manager pointed out that the game was racist, Duncan lost her temper, turned violent and had to be escorted from the building. She also had a reputation as a fantasist. A new colleague at Magnet recalled being warned, "Theresa lies about everything."

What was true was her background of blue-collar poverty and a father who had serious mental health problems. Born in the dreary South Michigan town of Lapeer (and buried there the day after Blake's death in July), Duncan confessed to a solitary childhood spent in public libraries – to a bookishness which, she confided to bloggers on The Wit of the Staircase, left her "knowing all the haunted shades of meaning that were captive in other people's words." "For this," she wrote, "they called me mad." As the Los Angeles Times noted after her death, it was a label that would follow her to the grave.

Malcolm McLaren has a different take on the story. "It was Jeremy who was the real troubled soul in that relationship," he says. "He was much darker than Theresa. His father died of Aids, he didn't see much of his mother. And he was screwed up by not knowing where he came from culturally. His mother was Jewish, but he had his father's really Waspy surname, Blake. I think that's partly why he took to me, that I'm a Jew called McLaren. He was a damaged person, and he relied on Theresa utterly."

The golden-couple image was flawed in other ways, too.' "If we're being honest," says McLaren, "Jeremy was gay. I don't think his relationship with Theresa was all that sexual. She was a mother to him. When I saw them in Hollywood, he was always terribly concerned that people would think he was a fag – he walked around with this hip flask of whisky in his pocket and he was constantly swigging from it, like some kind of cowboy."

Blake was also obsessed by the rock culture of his parents' generation, another thing that drew him to McLaren. At the time of his death, he was working on Glitterbest, a cinematic portrait of the Sex Pistols' Svengali, due to be shown at Washington's Corcoran Gallery this October. A taste for the early 1970s meant a taste for things British: Blake had already done a DVD portrait of the fashion designer Ossie Clark, composed of abstract images taken from Clark's floral prints. Interviewed by the supercool art magazine, Tokion, about the work's pink-and-blue prettiness, Blake was emphatic that his admiration for Clark was strictly artistic. "This guy was a gay jet-setter," he said. "I'm a straight guy from the suburbs of DC."

As you might have seen at the Serpentine Gallery this spring, Karen Kilimnik's art, like Sofia Coppola's films, plays dumb while being very clever. Theresa Duncan could have been a Kilimnik heroine, a Valley Girl given to quoting Proust. I leave a message on Kilimnik's phone in Philadelphia, asking her to talk about her collaboration with Duncan on The History of Glamour.

Instantly, she calls me back. Kilimnik's voice sounds shaky. "I was so thrilled when Theresa asked me to work on that film," she says. " It was such a great thing of her to do. I thought she was beautiful and wonderful and bright. Just wonderful. It's all so sad. I'm just glad the film is there, with my name and Theresa's name and Jeremy's name on the credits." She last saw the pair at a gallery opening in New York in September. They both seemed fine, no hint of trouble. She rings off.

Minutes later, Kilimnik calls back. "I just wanted to say, I've been thinking about the whole thing and maybe Theresa was right," she says. "Maybe those people were out to get them. Maybe they were murdered."

Such is the nature of Jeremy Blake's work that you can see it by tapping his name into youtube.com. If Blake was a lost 24-year-old when he met Duncan, living with her gave him artistic direction. He studied painting at CalArts, but by 1999 he had moved into a kind of work he dubbed "moving paintings " – brightly-coloured digital images, made on an electronic drawing tablet and looped into slow, morphing films. Their feel is vaguely trippy, Sixties; a trad/mod aesthetic that struck a nerve in late Nineties Manhattan. Blake's first exhibition, at Feigen Contemporary in 1999, got rave reviews. Within a year, he was showing in Los Angeles, Cincinatti, Philadelphia, Moscow, at Art Basel. From nowhere, the man Duncan called "Mr Wit of the Staircase" had become a hot property of his own.

And not just in galleries. Blake's work also caught the eye of the entertainment industry. In 2001, the rock star Beck commissioned him to make a DVD accompaniment to his song, "Round the Bend": a five-minute loop that morphs from Rothko-ish abstraction to stills of a chandelier. That year, Blake also shot a piece for the Adam Sandler film, Punch-Drunk Love. In 2002, he began his best-known work, The Winchester Trilogy, a portrait of the so-called Mystery House in San José, California. And in 2005 he made Sodium Fox, a hallucinatory paean to Delacroix's Liberty Leading the People, later shown in the Los Angeles gallery of British model-turned-dealer, Honor Fraser. In 2005, too, movie producer Bradford Schlei hired Blake to direct a feature film of George Pelecanos's novel, Nick's Trip.

While all of this was going on, he and Duncan had moved to Los Angeles, to a cottage on Venice Beach where they drove a yellow Alfa Romeo and threw nightly parties. Like Blake's work, the pretty surface hid an underlying darkness. For all its glamour, The Winchester Trilogy was about the madness of Sara Winchester, heiress to the rifle fortune who believed she was haunted by ghosts of the Civil War dead. The heroine of Sodium Fox was a stripper from an LA sex club, Crazy Girls.

By now, too, Duncan's drinking was becoming a problem. As is the way with Hollywood, the deal on Alice Underground had fallen through, a lapse she took personally. Duncan took to wearing glasses to interviews, believing studio executives mistook her for a dumb blond. When the film still didn't get made, she blamed Angelino snootiness at her working class origins. Finally, and fatally, Duncan began to believe that she was the victim of a smear campaign by the Church of Scientology.

The answer to the mystery of Jeremy Blake and Theresa Duncan is that there is no answer. Or maybe it is that they were the perfect couple – that when Duncan started blaming a cabal of Scientologists for her failure in Hollywood, Blake backed her up instantly and unquestioningly.

At first, Duncan's attack was aimed at actual members of the church, among them Tom Cruise and Blake's patron, Beck. By 2006, though, the couple were seeing Scientologists everywhere. A generation before, it would have been the Jews – it might still have been if Blake hadn't been Jewish himself. Now, he accused Schlei's girlfriend (wrongly) of being a Scientologist and dropped out of their film project. Neighbours in Venice Beach had anti-Scientology tracts pushed through their doors: when one called the police, Blake poured urine over her barbecue. He and Duncan were thrown out of their cottage and moved into his Santa Monica studio.

Friends like Honor Fraser were ordered to sign loyalty oaths, promising that they believed in the plot and weren't part of it. If they refused, they were subjected to a campaign of email abuse – "horrifying, sadistic stuff," says Malcolm McLaren. Once, Duncan had made sassy video games for young girls: now, her blogs on Wit on the Staircase spoke of links between the Church of Scientology and the CIA, the Bush administration, Lee Harvey Oswald. Blake went along with her. In 2004, he had been on the point of hitting the big time: Jonathan Binstock calls him "one of the great artists of this generation, a man who found a rich and resonant way of bridging the gap between digital imagery and painting". Now, Blake and Duncan fed each other's madness, their belief that they were being stalked, threatened. In January, "theremy" fled back to New York.

The rectory of St Mark's in the Bowery, Manhattan, is a handsome Gothic building, allegedly haunted by the ghost of Peter Stuyvesant. The church's pastor, Frank Morales, is a social activist who lives in a nearby squat. He writes articles on the military-industrial complex for magazines such as Covert Action Quarterly and is a member of the Kennedy Assassination Information Committee. When, in February, Duncan and Blake answered a New York Times ad offering a flat to let in the rectory, Morales was thrilled. The trio became friends, the couple attending the church. Morales's piece on a government plot to turn the US into a military dictatorship appeared in one of the Duncan's last blogs on Wit on the Staircase. He was with Blake when he discovered her body on 10 July.

"I wonder, in the end, if St Mark's was a good place for them to end up, " says Malcolm McLaren. "The last time I saw them there, in April, something had happened. They were quiet for the first time, brooding. When I saw Jeremy's stills from Glitterbest, I couldn't believe it. There was none of the usual Rothko-lozenge stuff – it was all very baroque, very dark: my face put onto the body of Abraham Lincoln, things like that." He pauses for a second and says, "Even so, I don't think Theresa intended to kill herself. I think she realised that she needed help, above all that Jeremy needed help." Then he says, "I hear that someone at Paramount is already pitching a film about them."

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