After the success of Strictly Ballroom, Luhrmann took some time over deciding what his next project would be:
Our philosophy has always been that we think up what we need in our life, choose something creative that will make that life fulfilling, and then follow that road. With Romeo and Juliet what I wanted to do was to look at the way in which Shakespeare might make a movie of one of his plays if he was a director. How would he make it? We don't know a lot about Shakespeare, but we do know he would make a `movie' movie. He was a player. We know about the Elizabethan stage and that he was playing for 3000 drunken punters, from the street sweeper to the Queen of England - and his competition was bear-baiting and prostitution. So he was a relentless entertainer and a user of incredible devices and theatrical tricks to ultimately create something of meaning and convey a story. That was what we wanted to do.
Luhrmann obtained some funds from Fox to do a workshop and shoot some teaser footage in Sydney. Leonardo DiCaprio agreed to pay his own expenses to fly to Sydney and be part of it. Once Fox saw the footage - of the fight scene - they agreed to support it.
All development was done in Australia with pre-production in Australia and Canada and post-production in Australia. While some parts of the film were shot in Miami, most of the film was shot in Mexico City and Veracruz. For instance, the Capulet mansion was set at Chapultepec Castle while the ballroom was built on Stage One of Churubusco Studios; and the church is Immaculate Heart of Mary in the Del Valle neighborhood.