UPDATED, writethru with press conference details: Guillermo del Toro gave the Venice Film Festival press corps a giant hug this morning, while also tugging — hard — at heartstrings. The press is hugging back. The filmmaker’s lyrical period fairy tale The Shape Of Water was met with sustained applause (and a fair amount of tears) as the lights rose in the Sala Darsena earlier today. Reviews that have followed are glowing, and this afternoon’s press conference was slightly delayed when reporters wouldn’t stop hooting and hollering as the filmmaker and his cast took their spots on the dais.

This is the Mexican helmer’s first time in competition on the Lido, and in a way completes a circle begun by his compatriots and pals Alfonso Cuaron and Alejandro G Inarritu whose Gravity and Birdman, respectively, in recent years made big splashes on this island.

Leaving the Darsena showing of Shape, “Bellissimo!” was overheard more than once, and social media reaction is strong for the Fox Searchlight pic that releases domestically December 8. The movie’s title is trending atop Twitter here. The official world premiere is tonight.

When it was announced as part of the Venice lineup, festival director Alberto Barbera called the Sally Hawkins-starrer del Toro’s best in a decade. It marks a return to Pan’s Labyrinth territory for the filmmaker as many are remarking here.

A romantic fantasy, Shape also stars Michael Stuhlbarg, Michael Shannon, Octavia Spencer and Richard Jenkins.

The Cold War-set tale kicks off in an American high-security government lab that’s hiding a top-secret experiment. That would be an aquatic man (Doug Jones) who’s worshiped as a god in the Amazon. The creature fascinates Elisa (Hawkins), the mute, lonely woman who cleans the facility and forges a relationship, initially based on a taste for hard-boiled eggs, but evolving into so much more.

Shannon’s agent and the military are the heavies as Elisa and friends rescue the beast and guard him for safekeeping at Jenkins’ flat — which is located above a cinema. Del Toro plays on old Hollywood references, including a black-and-white dance number that gives Elisa voice. There are also graceful, ethereal underwater scenes and a fair amount of poetry. Del Toro directed from a screenplay he wrote with Vanessa Taylor, and produced with J Miles Dale. Alexandre Desplat did the score — and some of his own whistling on the soundtrack.

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Del Toro mixes fantasy, romance, a B-movie thriller plot, old Hollywood style and more — he says the movie is “in love with love and in love with cinema.” But as with his 2006 Oscar winner Pan’s Labyrinth, the real world and the challenges we face today are represented too.

“I think that fantasy is a very political genre,” del Toro told reporters. The film is set in 1962 but, “it’s a movie about today.” His view is that folks pushing the “Make America Great Again” agenda are “dreaming of an America in 1962 that was futuristic and full of promise, but there was racism and classicism. It’s the same problems we’re facing today.”

Speaking of the creature who is pursued by Shannon’s Strickland, del Toro said, “I’m Mexican and I know what it feels like to be looked at as ‘the other.’ The creature has all of that.” He calls Strickland “an entitled mother***** for whom all these characters are invisible. He doesn’t see anyone because the arrogance is so big. But then his downfall is quite tragic.”

Carrying on with the theme, del Toro offered, “The issue we have today, choosing fear over love, is a disaster. Love is the strongest force in the universe. The Beatles and Jesus can’t be wrong at the same time.”

Del Toro was asked how the film relates to Beauty And The Beast, and gave his own take on that fairy tale. “There are two versions. One is puritanical where they love each other but never f***. The other one is perverse and creepy for me. I wanted to make clear that the character (Elisa) is a clear woman, masturbating and making her breakfast with equal ease. I wanted the sex to exist in an unexploited way, but they do f***.”

Hawkins got involved after del Toro and she met at the Golden Globes in 2014 (laughed the director: “I was drunk and it’s not a movie that makes you sound less drunk.”). The actress was coincidentally writing a short story about a woman who turns into a fish. The two then worked together on Elisa’s character. Said Hawkins of del Toro, “Once he’s got you in his embrace, he doesn’t let you go.”

She then teared up when Jenkins said of her, “I wish she was my daughter.” His character Giles is Elisa’s neighbor and constant friend who is another sort of outcast. He gushed, “At this time in my life to be able to be part of something as fricking fabulous as this, it’s more than I could hope for.”

Finally, del Toro was asked about the Pinocchio project he’s been mulling for a decade. “I almost always complicate my life because none of the movies I want to do are easy and they don’t belong to what anybody wants at the time — at the time of Hellboy nobody wanted to do superheroes,” he laughed. With Pinocchio, he received several phone calls from studios who said they wanted to do it, but whistled a different tune once they heard that it’s set during the reign of Mussolini.

He then smiled wide as the press conference wrapped up, “So, if you have $35M and you want to make a Mexican happy…”