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The old building that became Xanadu was the Pan Pacific Auditorium on Beverly Boulevard, near CBS's Television City in Hollywood, California. It was built in 1935 but was only used for exteriors in this movie. Interiors were filmed on Stage 4 of the Hollywood Center Studios. The Pan Pacific Auditorium was destroyed by a fire in 1989. A community center now sits on the site, featuring a single version of the Pan Pacific's 4 curved deco spires
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The set of the Xanadu club cost $1,000,000 to build.
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Gene Kelly took the part of Danny McGuire because filming was a short drive from his Beverly Hills home and he could be close to his family at the same time.
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"Don't Walk Away", an animated sequence in the film, features scenes nearly identical to portions of Thumbelina, namely a shot of a small girl walking behind a leaf. Both were directed by Don Bluth.
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Playing on a 99-cent double-feature with Village People in Can't Stop the Music, this inspired John Wilson to create the Razzie Awards, dishonoring worst achievements in film. It later won the first ever Worst Director Razzie Award for Robert Greenwald.
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Gene Kelly's final feature film.
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Since fantasy is Xanadu's dominant trait, certain mattes, including a couple of time-lapsed cloud effects matted over the departure along the highway of one of the muses, and another matted above Gene Kelly as he sits on a beach playing a clarinet, don't look 100% realistic. This was intentional, done with the hope that the various sequence take a mythical ambiance that looks unreal, rather than phony.
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Further into completion, Joel Silver, Robert Greenwald and Victor J. Kemper started wanting more effects, fancier effects, heavier effects. Then with its Christmas 1980 release moved up by Universal Pictures to summer 1980, this was now unattainable.
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One aspect of the special effects that proved difficult was the fact that Xanadu is an earthbound fantasy, and many of the elaborate matting effects had to be successfully worked into naturalistic settings, street scenes, etc. One of the muses even exits as a live-action tapered streak from within the metal superstructure of a large building, to cite a particular example. Robert Greenwald stated this was more difficult than having the ability to pull off its most impressive effects within the comfortable black limbo of space.
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The mural depicted in the film never existed. Rather, it was a digital image superimposed over one of the shops in an alleyway on Dudley Avenue and Ocean Front Walk in Santa Monica, California during post-production.
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Famously received the one sentence review: "In a word, Xana-don't".
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Following on the heels of Olivia Newton-John's enormous success in Grease, this was meant to launch her career as a solo star. Its complete failure at the American box office ensured that this would be the one and only time she ever received top billing without a co-star in a theatrical release.
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VARIETY's review of this film referred to Olivia Newton-John's character as "a rollerskating lightbulb."
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The title comes from a Samuel Taylor Coleridge poem called "Kubla Khan". The same name was also used as the name of Charles Foster Kane's residence in Citizen Kane.
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Olivia Newton-John fractured her coccyx while filming the dance sequence "Suddenly".
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According to Olivia Newton-John, filming began without a finished script; it was written as filming went on.
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In the two-page booklet included with the DVD, it is stated that the film was originally conceived as a straight-on roller-disco movie, but that the imminent release of two quickie roller-disco films (Skatetown, U.S.A. and Roller Boogie) prompted many changes (like its blending of 1940s and 1980s styles), which may explain why star Olivia Newton-John complained of the film being written while it was being made.
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Though an infamous flop initially, it has since achieved "cult" status, and like other failed musicals of its time (The Apple and Can't Stop the Music), is quite popular with gay audiences.
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The original budget was $4 million, but as producer Joel Silver developed it, costs rose to $13 million. Universal head Ned Tanen fired Joel Silver, who immediately went to work for his friend and mentor Lawrence Gordon - who was also a producer on the film, so Joel Silver was back on the project.
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Despite the failure of the film at the box office, the soundtrack was an enormous success. The song "Magic" went to #1 on the U.S. pop singles chart.
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The word Xanadu is spoken 21 times in the end song "Xanadu".
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Olivia Newton-John turned down a role (which eventually was played by Valerie Perrine) in Can't Stop the Music to star in this movie.
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There were 60 Xanadu Dancers, for the Xanadu Roller Disco scene.
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Andy Gibb was originally cast to play Sonny.
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Danny McGuire was also the name of Gene Kelly's character in Cover Girl, in which he co-starred with Rita Hayworth, about the time the Danny McGuire of this later film reached his peak. The Olivia Newton-John musical features Gene Kelly's last song-and-dance role.
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In the UK, the soundtrack album peaked at number two, whilst the single "Xanadu" peaked at number one for two weeks in July 1980.
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This film is listed among the Top Ten Best Bad Films ever made in Golden Raspberry Award founder John Wilson's book THE OFFICIAL RAZZIE MOVIE GUIDE.
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The Broadway stage version opened at the Helen Hayes Theater on July 10, 2007, ran for 512 performances and was nominated for the 2008 Tony Awards for the Best Musical and Book.
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After Kira has told Sonny that she is one of the Greek muses, she starts to say, "My real name is Terp - ", but Sonny shushes her, and we never get to hear her real name. However, since she is there to help him open a dance club and she is obviously a dancer herself, it is likely that she was about to say that her name was Terpsichore, since Terpsichore was the Greek muse of dance.
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The last musical that Hollywood hoofer Gene Kelly ever made.
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Directorial debut of a theatrical feature for producer-director Robert Greenwald.
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Michael Beck doesn't sing in this movie. Beck was dubbed by Cliff Richard.
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Olivia Newton-John and Matt Lattanzi met whilst shooting this movie, Lattanzi only having a minor role in the picture. The two formed a relationship and Lattanzi accompanied Newton-John to Australia on a promotional visit for Xanadu where he met her parents. The two were married in 1984 and had one child, Chloe Lattanzi. They were divorced in 1995.
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According to the DVD Special Features, this movie was originally conceived as a low-budget roller disco movie.
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When Danny McGuire (Gene Kelly) in the movie jokes that "they used to have wrestling here" he was actually making a true statement as the the Pan Pacific Auditorium used to stage wrestling matches.
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Amazingly, this was Olivia Newton-John's final big screen theatrical musical for many many years until Score: A Hockey Musical, a staggering gap of thirty years. The movie Two of a Kind Newton-John made with John Travolta was not a musical, though she did sing songs for that movie's soundtrack.
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According to the special features on a recently released DVD, the cartoon sequence was added because the filmmakers were required to include an extra song written for the movie. Having a cartoon made for that song was easier than trying to make it fit into the movie.
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The dance number between Gene Kelly and Olivia Newton-John was filmed after production for the movie had finished and it became clear the filmmakers had not given their audience the one scene the movie required: Gene and Olivia dancing together. Gene Kelly choreographed the dance number. His conditions for doing it included a closed stage that included only himself, Olivia Newton-John, a cameraman, a choreographer he had befriended, and two others.
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Michael Beck didn't have to audition for the lead in this film.
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Cameo 

Sandahl Bergman:  As Muse No. #1.
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Wilfrid Hyde-White:  As Heavenly Voice #1.
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Coral Browne:  As Heavenly Voice #2.
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