The film stars Melissa McCarthy, Bill Barretta, Joel McHale, Maya Rudolph, Leslie David Baker, and Elizabeth Banks.

Various actors, including Cameron Diaz, Katherine Heigl and Jamie Foxx, were approached to star before McCarthy signed on in May 2017.

Now a private investigator with a human secretary named Bubbles, he is hired by puppet client Sandra White to discover the identity of her blackmailer.

While he checks their records in a back room, an attacker kills everyone else present including Mr. Bumblypants, a former cast member of the beloved sitcom The Happytime Gang.

That night, Phil's brother Larry, another former Happytime cast member, is torn apart when someone lets dogs onto his property.

After having sexual intercourse with Sandra and escaping the FBI, Phil goes to see Jenny, the only human Happytime cast-member and his former girlfriend, at a puppet strip club where she works.

They break into Sandra's home and discover a hidden room containing plans for the deaths of the Happytime Gang stars and a frameup of Phil.

He restores Edwards to active duty and convinces the mayor to lift the ban on puppet cops, welcoming Phil back on the force.

[9] This was followed by Maya Rudolph being added in August,[9] and in September, Elizabeth Banks,[10] puppeteer Bill Barretta[11] and Joel McHale[12] all officially joined the cast.

[17][18] The Happytime Murders was released on Digital HD on November 20, 2018, and on DVD and Blu-ray on December 4, 2018,[19] by Universal Pictures Home Entertainment.

[2] In the United States and Canada, The Happytime Murders was released alongside A.X.L., and was projected to gross $13–15 million from 3,225 theaters in its opening weekend.

The website's critical consensus reads, "The Happytime Murders wastes its intriguingly transgressive premise on a witless comedy that blindly pushes buttons instead of attempting to tell an entertaining story.

Jess Fenton for Switch wrote: I adored the concept, I loved the cast, the fact that this was directed by Jim Henson's son made me giddy, and yet...

But its most fatal miscalculation is the decision to frontload so many of its crassest setpieces into the first 15 or 20 minutes, depriving the rest of the film of the shock value that is its entire raison d'etre.

[25] The film received a positive review from William Bibbiani at IGN, who wrote: The Happytime Murders may not be a timeless classic on par with Roger Rabbit, but it's more interesting and nuanced than its raunchy, violent humor suggests.

[26]Entertainment Weekly's Chris Nashawaty gave the film a C+, stating that "the cognitive dissonance of kiddie characters dropped into extremely adult situations should set off taboo sparks like they did in Team America: World Police ... but mostly it feels like a promising idea poorly executed.

The Happytime Murders, the R-rated look at a serial killer running wild in a puppet-populated L.A., has what it takes to be a contender for worst of the decade.

[33][34] On May 30, 2018, the lawsuit was rejected by the presiding judge for the case, with STX issuing a brief statement soon thereafter: We fluffing love Sesame Street and we're obviously very pleased that the ruling reinforced what STX's intention was from the very beginning – to honor the heritage of The Jim Henson Company's previous award-winning creations while drawing a clear distinction between any Muppets or Sesame Street characters and the new world Brian Henson and team created.

[35]Some subsequent television spots for the film made references to the lawsuit by starting the ads with "From the studio that was sued by Sesame Street..."[36]