Any film that purports to be a fairy tale and has the gall to kick it off with the line, "Once upon a time..." had better be able to deliver the goods. Well, as Andrew Adamson, the New Zealand-based half of the Shrek directing team might say, "No worries."

This is definitely a fairy tale, one of a rather warped variety, with a big, ugly, green ogre as the title character (voiced by Mike Myers in the thickest of Scottish accents). He's the kind of ogre -- bad breath and all -- who if just left alone in his swamp, not having to deal with anyone or anything, would be quite content, thank you. Unfortunately there are events brewing around him that are going to make a peaceful, solitary existence quite impossible.

It seems that the diminutive, self-centered, and nasty Lord Farquaad (voiced with malevolent glee by John Lithgow) has decided he wants to become king. But in order to do that, he must first marry a princess. In order to find the princess, he must get a hold of a magic mirror. But the only way to do that is to search through every fairy tale character he can get his hands on.

To be honest, this whole part of the film is a bit confusing, but suddenly, there they are, pretty much every fairy tale character you can think of -- there are too many to list here -- all for some reason or another, relocated to and running around in Shrek's swamp. The storyline has him making a deal with the miserable Farquaad that will give Shrek his swamp back if he voyages off to find the princess of Farquaad's dreams and brings her back.

And here is where the film does indeed deliver the goods... in a grand manner. Against his will, Shrek is saddled with a partner on the long trip -- a jive-talking wiseguy of a stunted donkey named Donkey (voiced absolutely hilariously by Eddie Murphy, who gets the best of the film's comic lines). Shrek doesn't talk much; Donkey refuses to shut up. There's a little bit of Ralph Cramden and Ed Norton in all of this.

But there's also a lot more. Today's technology has moved the art of computer animation well beyond all of the wonders that were presented in Toy Story and Toy Story 2. This is all just spectacular, from the vast colorful tracts of countryside locations, to the huge castle holding the princess, to the body movements, facial expressions and even the way the characters' hair moves so naturally. It's extremely difficult to think of any of this as a cartoon.

And it's brimming with visual gags -- a couple of them of the toilet humor variety, but even those will cause everyone to giggle. Then there are some perfectly placed references to popular songs (Bette Midler, Willie Nelson and Otis Redding are borrowed from) and no end to winks directed at other movies -- at one point after a particularly adventurous segment, Shrek looks warmly at his pal and says, "That'll do, Donkey."

Consistently funny, the film is also tremendously exciting, as seen in the sequence that introduces the fire-breathing dragon guarding Princess Fiona (Cameron Diaz, a little flat in her voicing compared to the rest of the cast). A battle pitting the dragon against Shrek and Donkey is one stunning piece of work, with camera movement galore and characters flying through the air and, finally in an animated film, some very convincing fire.

Then, before you can say Sherwood Forest, the comedy is back in full force with an introduction to Robin Hood and a slightly naughty explanation of why his crew is always referred to as "merry men." When the film briefly slows down to get serious, it's always for good reason. In separate scenes we get to know a little more about what makes both Shrek and the princess tick, and we're presented with messages ranging from the importance of friendship to the relative unimportance of what we look like.

It shouldn't be at all surprising that there's a happy ending, but the film takes a wonderfully inventive and very thoughtful approach to getting there. On the way, the folks who created it -- for the record it's based on a picture book by William Steig -- have fashioned one of the best family films ever made. Kids of all ages are going to love the funny-looking characters and the comic situations. But only adults are going to get the multi-leveled jokes and appreciate all of the clever asides. See it with your kids, or see it at an evening screening without them. It'll work quite well either way.