Development for a film adaptation of the Sonic the Hedgehog video games began in 1993 during production of DIC Entertainment's television show Adventures of Sonic the Hedgehog. Michealene Risley, the newly appointed consumer products director who helped license Sonic for Adventures, negotiated with several Hollywood producers. Sega of America CEO Tom Kalinske was wary of damaging the brand, citing the commercial and critical failures of the Super Mario Bros. and Street Fighter films. Despite Kalinske's concerns, Sega was enthusiastic. In August 1994, Sega struck a development deal with MGM and Trilogy Entertainment Group, with Pen Densham as executive producer.
MGM and Sega hired Richard Jefferies, an associate of Risley from her days at Marvel Comics, to write a film treatment. At the time, Sega was developing the video game Sonic X-treme (which was canceled in late 1996) for its next console, the Sega Saturn, and asked Jefferies to feature the Saturn in the screenplay. Jefferies' treatment, Sonic: Wonders of the World, was submitted in May 1995. While the draft received a positive response among MGM and Sega executives, Sega COO Shinobu Toyoda suggested Kalinske replace Robotnik with a meaner villain. MGM canceled the project after a failed attempt to revive it at DreamWorks. Jeffries suggested that the film was scrapped as both Sega and MGM wanted a higher share of the profits, while Densham said it followed creative differences between Sega and Trilogy.
In September 2003, Penders pitched his own concept for a Sonic film, Sonic Armageddon. In Penders' words, the movie would have been an origin story and a series reset, resolving the plot threads which began in the animated Sonic show and continued in Archie's comic series. The project was dropped in 2007 due to a corporate upheaval and the death of Sega licensing manager Robert Leffler, who had supported Penders.
In 2013, Sony Pictures Entertainment acquired the rights to produce and distribute a Sonic film. On June 10, 2014, a live-action animated film was announced as a joint venture between Sony Pictures's Columbia Pictures and Marza Animation Planet, a Japan-based subsidiary of Sega Sammy Holdings which had produced CGI cutscenes for several Sonic games. It would be produced by Neal H. Moritz by his Original Film banner alongside Takeshi Ito, Mie Onishi, and Toru Nakahara, and written by Evan Susser and Van Robichaux. In February 2016, Sega CEO Hajime Satomi said the film was scheduled for 2018. Blur Studio's Tim Miller and Jeff Fowler were hired in 2016 to develop it; Fowler would make his feature directorial debut, and Miller would serve as executive producer. Blur Studio previously produced cutscenes for the games Shadow the Hedgehog (2005), for which Fowler directed cutscenes, and Sonic the Hedgehog (2006). Patrick Casey, Josh Miller, and Oren Uziel were writing the screenplay, while Casey and Miller wrote the story, however, the former two received their writing credit and Uziel went uncredited.
On October 2, 2017, Paramount Pictures announced that they had acquired the rights after Sony put the film in turnaround. Almost all of the production team remained unchanged. Coincidentally, Paramount and Sega had once been sister companies under Gulf and Western Industries; Gulf and Western sold Sega's assets in 1984. In February 2018, it was announced that the film would be released in November 2019. During production the film used the working title "Casino Night", named after one of the stages in the Sonic games. Early drafts featured Sonic's Super Sonic form from the video games; the ideas were latterly discarded, as Fowler felt that "it didn't make sense to obviously bring in the Super Sonic thing just yet" and instead wanted to focus on the origins of Sonic and Robotnik's relationship.Casey and Miller reportedly described the film as not faithful to the game, while producer Toby Ascher favored their buddy comedy approach. Inspirations for the story also include many other buddy comedies, such as Midnight Run and Dumb and Dumber.
In May 2018, it was reported that Paul Rudd was in talks for a lead role as Tom, "a cop who befriends Sonic and will likely team up to defeat Dr. Robotnik"; however, this was later denied by Paramount. A day later, it was announced that James Marsden was cast in an undisclosed role, but later revealed to be Tom Wachowski. In June, Tika Sumpter was cast as Tom's wife Maddie, with Jim Carrey cast to play the villain, Dr. Robotnik.
In August, Ben Schwartz joined the cast to voice Sonic. This marked a rare occasion in which the character would not be voiced by Roger Craig Smith, who voices Sonic in most incarnations since 2010. Schwartz, a fan of the original video games, was chosen for the role after Fowler and Miller cast him for a test reading as they pitched the project to several studios. Having enjoyed his performance, they officially cast Schwartz as the voice of Sonic. Adam Pally and Neal McDonough were added to the cast later that month. Debs Howard and Elfina Luk joined the cast the following November. Riff Raff was cast in an undisclosed role, but was cut from the film.
Principal photography began in mid-September 2018 and ended in Vancouver, Ladysmith, and Vancouver Island on October 16, 2018. Key production scenes were also filmed in Liwa Oasis, United Arab Emirates. During filming, Ben Schwartz was unavailable, so a stand-in performed alongside Marsden.
The visual effects are provided by Moving Picture Company (MPC), Marza Animation Planet, Blur Studio, Trixter, and Digital Domain. The production team created a live-action version of Sonic using CGI, adding fur, new running sneakers, two separate eyes, and a more human like physique. They used Ted, the living teddy bear from the Ted films, as a reference to insert a CGI character into a real-world setting. Executive producer Miller said: "It would be weird, and it would feel like he was running around nude if he was some sort of otter-like thing. It was always, for us, fur, and we never considered anything different. It's part of what integrates him into the real world and makes him a real creature." According to Miller, Sega was not "entirely happy" with the design of Sonic's eyes.
On May 2, 2019, in response to the criticism, Fowler announced on Twitter that Sonic would be redesigned. The film was delayed from its original release date of November 8, 2019, to February 14, 2020, as a result. Artist Tyson Hesse, who worked on previous Sonic the Hedgehog media, was brought on to lead the redesign. Sonic was given larger and differently colored eyes, new sneakers, white gloves, and a less humanlike body to better resemble Sonic's video game design. Sonic was redesigned by Marza Animation Planet. The redesign added an estimated $5 million to the production budget, took around five months, and was achieved without overtime.