Audrey Tautou stars in the film which focuses on Chanel's younger years. The supporting cast includes Benoit Poelvoorde, Marie Gillain, Emmanuelle Devos and Alessandro Nivola.
The film will be distributed in France by Warner Bros Entertainment France and internationally by Warner Bros in 2009. It will shoot for 12 weeks in Paris.
Fontaine wrote the script with Camille Fontaine from Chanel biography L'irreguliere (The Non-Conformist) by Edmonde Charles-Roux. Christopher Hampton acted as a consultant on the script.
Karl Lagerfeld, the renowned fashion designer and current artistic director of The House Of Chanel, will personally supervise the recreation of the costumes and accessories worn by Chanel in the film which will feature many vintage outfits from the Chanel collection.
The film is the second teaming between Warner Bros and Fontaine whose comedy The Girl From Monaco opened last week in France.
'I'm delighted to be working with Warner Bros. International again after our successful collaboration on The Girl From Monaco,' she said in a statement. 'Audrey Tautou embodies all the qualities that made Coco such a fascinating individual, and the support we've received from The House of Chanel is incredibly gratifying.'
'Coco Avant Chanel is an incredibly exciting project for our company,' said Richard Fox, executive vice president, international, Warner Bros. Entertainment. 'Anne is a fantastic director to have at the helm of this project, and we couldn't be blessed with a better talent than Audrey to give life to the essence of the legend that is Coco.'
'We're happy to continue our collaborations with Anne Fontaine and Audrey Tautou, together this time, on another new French film with terrifically broad appeal,' added Warner Bros France chief Francis Boespflug.