The Twisted Sister star wrote the track for his wife, Suzette, and decided to offer it up to producer pals during a lean period in the early 1990s.
He notes Boyz II Men almost recorded it and then an old pal offered to pass it along to Celine for an upcoming festive album.
She loved the track and Snider urged his friend not to tell her that he was the songwriter, fearing she might balk at the idea of recording one of "Satan's" tunes.
The song became one of the most successful Christmas recordings of all time and Dee still doesn't know if Dion realizes he's the D. Snider credited with penning the tune.
"I don't know to this day if she knows that I wrote the song, but it's the biggest selling holiday record in history - 14 million copies worldwide, or something like that," Snider tells Ultimate Classic Rock. "So, that was just a gift. Saint Celine gave my family a gift, and now the song has taken on a life of its own."
Snider has now re-recorded the tune, retitled "The Magic of Christmas Day", with Lzzy Hale of Halestorm, and admits he still can't believe he's featured on a festive tune.
"Over 30 years ago, (I would have said), 'I'm not going to release a Christmas song!' " he laughs. "I would have punched you in the face for saying that Twisted Sister would do a Christmas album, but time changes everything."