It was founded in April 1984 by producer/director Tsui Hark and his now ex-wife, Nansun Shi.

Already a director with box office hits, Tsui wanted to create a workshop where the foremost filmmakers could work on films with artistic merit, and at the same time, films that could be commercially rewarding for the financiers behind his projects.

In 1984, Film Workshop's first film, Shanghai Blues, turned out to be both a critical and commercial success in Hong Kong; and so were the two subsequent films that Tsui directed: Working Class and Peking Opera Blues.

With Tsui producing, John Woo directed A Better Tomorrow, which grossed US$4.5 million locally to set a new record as the highest grossing motion picture in Hong Kong.

After having a falling out during the making of A Better Tomorrow 2, they both split to produce their own films.