Rather than offer a literal adaptation of the Miguel de Cervantes novel, Welles opted to bring the characters of Don Quixote and Sancho Panza into the modern age as living anachronisms.
Welles explained his idea in an interview, stating: "My Don Quixote and Sancho Panza are exactly and traditionally drawn from Cervantes, but are nonetheless contemporary.
The anachronism of Don Quixote's knightly armor in what was Cervantes' own modern time doesn't show up very sharply now.
[6] On June 29, 1957, after having been removed from his own film Touch of Evil, Welles headed to Mexico City to begin work on the feature-length version of Don Quixote.
Spanish actor Francisco Reiguera was cast as Don Quixote and Akim Tamiroff remained as Sancho Panza.
[5] In later years, he stated that he wished to re-film her scenes, plus some new ones, with his daughter Beatrice Welles (who had a small part in his Chimes at Midnight).
During the 1960s, Welles shot fragments of Don Quixote in Spain (Pamplona, Málaga and Seville) and Italy (Rome, Manziana and Civitavecchia) as his schedule and finances allowed; he even found time to film sequences (reported as being "the prologue and epilogue") while on vacation in Málaga commuting all the while to Paris to oversee the post-production work on his 1962 adaptation of The Trial.
[9] Welles continued to show Don Quixote and Sancho Panza in the present day, where they react with bafflement at such inventions as motor scooters, airplanes, automobiles, radio, television, cinema screens and missiles.
The production became so prolonged that Reiguera, who was seriously ailing by the end of the 1960s, asked Welles to finish shooting his scenes before his health gave out.
[11] At one point in the 1960s, Welles planned to end his version by having Don Quixote and Sancho Panza surviving an atomic cataclysm, but the sequence was never shot.
In 1972, Welles dispatched his cinematographer Gary Graver to Seville, to shoot the Holy Week procession and some inserts of windmills for the film—although this footage has since been lost.
He told her that he could only complete Don Quixote if he one day decided not to return to Spain, since every fresh visit gave him a new perspective, with new concepts for the film.
[18] The footage consisted of 45 minutes of scenes and outtakes from the film, assembled by the archivists from the Cinémathèque Française and supervised by the director Costa-Gavras.
Additional footage, including the negative, was held by Welles' editor Mauro Bonanni [it] in Italy, and in at least one other private collection.
Finally, Corte Suprema di Cassazione, Italy's highest court of appeal, ruled against Bonanni in June 2017.
In 1990, Spanish producer Patxi Irigoyen and Franco acquired the rights to some of the extant footage of the Don Quixote project.
[21] In his will, Welles left Kodar the rights to all his unfinished film projects (including Don Quixote) and she was keen to see it completed.
She spent the late 1980s touring Europe in a camper van with her Don Quixote footage, and approached several notable directors to complete the project.
However, Irigoyen and Franco were unable to obtain the footage with McCormack, which included a scene where Don Quixote destroys a movie screen that is showing a film of knights in battle.
Welles recorded less than an hour's soundtrack where he read a narration and provided dialogue for the main characters, but the rest of the footage was silent.
Furthermore, Welles feared a repetition of the experience of having the film reedited by someone else (as had happened to him on The Magnificent Ambersons, The Stranger, The Lady from Shanghai, Macbeth, Mr. Arkadin and Touch of Evil), so he divided up all the reels of film for Don Quixote and deliberately mislabelled many of them, telling Mauro Bonanni, "If someone finds them, they mustn't understand the sequence, because only I know that.
"[24] The Irigoyen and Franco work premiered at the 1992 Cannes Film Festival as Don Quixote de Orson Welles, with English- and Spanish-language versions produced.
[15] Spanish film critic Juan Cobos saw a rough cut of Welles's unfinished footage (which he praised very highly), and stated that the 1992 edit by Franco bore little resemblance to it.