In the past there have been a few cinematic stabs at capturing the pain that can lie behind the brash front of professional comedy and the nastiness of the media substructure that supports and exploits it, but none have tackled the subject as directly or successfully as Annie Griffin's first feature, Festival. Set and filmed at the Edinburgh Festival, Griffin develops the comedy of embarrassment elements of her TV series, The Book Group, and draws on her own experience performing at the festival in the 80s to create an Altman-esque, multi-stranded examination of the sometimes desperate underside of the desire for recognition through comedy, at the same time offering a critique of the festival's gradual shift from the dramatic to the comedic.

Central to the interlinked narratives is Sean Sullivan (Stephen Mangan), a successful English comedian (known as "the man of a thousand voices," a moniker he detests), who is on the verge of a career in Hollywood and in town as a jury member for the festival's annual Comedy Award (or Perrier Award if you want a real life equivalent), a task he has no real interest in performing. Likely a composite of various British comedy talents rather than based on any one individual, Sullivan is a self-centred shit of the highest order, aggressively rude to just about everyone he encounters, save for the women he instantly tries to talk into bed. First in his sights on arrival in the city is Nicky Romanowski (Lucy Punch), herself an aspiring comic on the road to building her own ego and attitude, which soon creates further grief for Sullivan's long-suffering PA, Petra (Raquel Cassidy). Also in town is weary Irish regular Tommy O'Dwyer (Chris O'Dowd), fellow countryman and relative newcomer, Conor Kelly (Billy Carter), diminutive Faith Myers (Lyndsey Marshal) with her one-woman show on Dorothy Wordsworth ("Who's in it?" asks a passer-by), and the towering figure of Brother Mike (Clive Russell) with his piece on paedophile priests. A trio of Canadian actors (Megan Dodds, Meredith MacNeill and Jonah Lotan) arrive in a fairyland daze at the house they have rented from depressed landlady Micheline (Amelia Bullmore), who appears no longer able to communicate with her wealthy lawyer husband or care for her young daughter, and who starts to fixate on the idea of joining the troupe and fleeing to Canada. And covering the event for BBC Radio Scotland is Joan Gerard (Daniela Nardini), also a jury member but one who has developed a cynicism for comedians and the undue attention they command. It takes her only a few live broadcast questions to establish a hostile relationship with the sneering Sullivan.

Although drawn together by circumstance, most of the characters are dealing with issues that their interaction and conflict with their peers help bring to a head, a component that the film uses to bind characters to each other, even those who never actually cross paths. Tommy can barely believe he has been coming to the festival for nine years without official recognition and takes to chatting up Joan Gerrard in the hope of securing an award nomination, but when she calls his bluff and drags him off to a hotel for a quick shag, his alcohol fuelled terror of sexual encounters immediately resurfaces. Joan, on the other hand, appears to be looking merely for a diversion from a job that she is increasingly frustrated by and a relationship she clearly no longer finds fulfilling ("Why are you always here?" she agitatedly asks boyfriend and fellow jury member Dougie on returning home one day, only to have him reply in bemusement "I live here – it's my flat"). Petra, meanwhile, is an ex-alcoholic who is almost driven back to drink by Sullivan's arrogant insensitivity, but curiously seems unable to quit the job, having replaced chemical abuse with an intellectual one. Also fighting withdrawal symptoms is Brother Mike, whose show seems less a fanciful creation than an attempt at active redemption for his own past crimes. But while Petra is saved from downfall by a chance meeting with a kindred spirit, Mike sows the seeds for his own self-destruction in a way that suggests that even the strongest drug is no substitute for the destructive power of Catholic guilt.

Griffin's own voice is clearly evident both in Faith's go-it-alone belief in the purpose of her play and Joan's heartfelt rant against the comedy establishment and the increasing dominance of stand-up over serious drama at the Festival. But despite lampooning their self-absorbed pretentiousness and relational fragility, Griffin aligns herself most clearly with the Canadian trio. Arriving from afar all agog at the city and its people and saddled with their own ludicrous codes of communication, they nonetheless fill the theatre for their performance and leave attendees Faith and Mike, who have by then become friends, dazed at their brilliance. In a film peppered with sometimes desperate stand-up comedy, it is the sincere dramatists who really know how to connect with an audience.

There's an almost gleeful nastiness to the deconstruction of the comedy fraternity, with characters driven almost exclusively by opportunism and spite and no chance is missed to show people at their mean-spirited worst. That such a damaged collection should find themselves in such close proximity may seem an exaggeration, but Griffin has drawn them all from personal experience, and I can certainly testify to the very real foundations from which the characters have been built. Comedy based on hostile conflict is always a tightrope walk, but Festival scores because, thanks to a harmonic blend of script and performance and an editing structure that times its location shifts to perfection, its people are all interesting.

Working on Griffin's own philosophy that a character doesn't have to be likeable for an audience to connect with them, Stephen Mangan make Sullivan a fascinating and even oddly charismatic figure that you nonetheless sometimes want to kick in the nuts until his face turns purple. Yet even after his vicious coup-de-grace at the climactic award ceremony, you still manage to feel for him as he wanders wearily back into his hotel (and believe me, by this point you absolutely shouldn't). Chris O'Dowd works similar magic with Tommy O'Dwyer, creating a selfish and somewhat pathetic man that you still can't help rooting for, though putting him in conflict with Sullivan inevitably shines a small light behind his head, not least when he silences Sullivan's mock-Irish piss-take at Tommy's own gig with the very direct retort, "You're English. And you're a cunt." The superb Lucy Punch finally gets to show her worth as Nicky Romanowski, following her glorious tragi-comic performance in Clara Glynn's 2001 short film It's Not You. It's Me (do try and catch this if you can), She also provides what in the cinema was the film's biggest laugh-out-loud scene, as she cheerily delivers her Jewish Mother monologue to Sullivan whilst giving him a hand-job as he furiously tries to ignore her words ("Can we not talk about mothers right now?") and fantasise about Thai prostitutes instead. All of the main cast deliver, with Lyndsay Marshall engagingly wide-eyed and innocent as Faith Myers, Raquel Cassidy hitting just the right note of pathos as the endlessly put-upon Petra, and Daniela Nardini making for a convincingly and enjoyably cynical Joan.

Particularly noteworthy is the fun Griffin has with the minor characters, from the pompously judgmental prejudices of the jury members, who complain that Nicky is just pandering for laughs ("She's a comedian!" retorts Sullivan incredulously) or that there are no funny tall women ("The cut-off is 5-7. She's two inches above funny"), to the seen-it-all stage technicians and the overly eager hotel receptionist (Gabriel Quigley), star-struck at the sight of Sullivan but bemused when Joan and Tommy want a room for an hour just for sex ("I'm not used to famous people," she cheerily bumbles, "I didn't know about the one hour thing"). The real scene stealer, though, is Deirdre O'Kane as Irish jury member Frida Finucane – fired up with enthusiasm at being involved in such an event and darting back and forth to Tommy with updates on the vote and misplaced words of encouragement ("I know all of your material!"), she is a smiling ball of excited energy who would not be out of place guesting on Father Ted.

But every now and again the blackly comic and even sad waters part to reveal moments of almost startling gentleness, most of which revolve around Canadian actor Rick and landlady Micheline, with Rick's discovery of Micheline's kimono, her hidden observation and imitation of his yoga exercises, and their early morning walk and talk developing into a story strand that offers a small glimmer of hope for this one lost soul. It is out of these scenes that the film's most unexpectedly beautiful moment emerges, as Micheline climbs a hill to both emotionally connect with happier times and take a last look at her home city, and Jim Sutherland's score, a heady mixture of bagpipes, wailing horns and walk-to-the-gallows drums, gives way to a eye-wateringly emotive Gaelic song.

Festival is not an easy sell, having none of the insufferably twee romanticism and sell-it-to-America Englishness that has made so many British comedy films of recent years so indigestible to those of us with a more cynical world view. It's a cynicism that Festival has in abundance and which is bound to alienate the happy-ending crowd and those with even an ounce of prudery (I haven't even touched on the drunken cunnilingus and anal fisting scenes). But as someone who genuinely almost threw up at the climax of Notting Hill, Festival is a breath of the freshest Scottish mountain air, a gloriously barbed, painfully witty look at a malicious side of the entertainment industry that is long overdue for a cinematic arse kick. The film's recent Best Film win at the British Comedy Awards can be seen almost as ironic, given its own view of the voting process, but is fully deserved. Indeed, for my money Festival is the leading contender for best British film of 2005.

Framed 1.85:1 and anamorphically enhanced, the transfer here is good but a few notches short of great, with some scenes having a slightly washed-out look to them, though elsewhere contrast and colour are stronger. The picture is a tad soft in places, but the documentary nature of much of the footage, which was grabbed during the festival itself, is largely responsible for this.

The 5.1 soundtrack is very nice, with sometimes excellent separation of music and dialogue (in early scenes, music sits at the back while dialogue and effects play at the front) and buzz of crowds is often effectively inclusive.

There's also an audio descriptive track, which has its moments during the more explicit scenes ("He takes a quick swig from a miniature bottle of liquor and gets down to business," and so on).

I know this is a bit odd, but I'd like to kick off by noting what's not present and should be, and that's a commentary by writer/director Annie Griffin. Her commentaries on series 1 of The Book Group were first rate, and this is a film that just demands that level of background information. This is an opportunity missed. Anyway, on to the bits that are there.

The Making of Festival at the Festival (10:10) is a making-of featurette that looks at the rehearsals, character improvisations and on-the-street shooting. There's some fascinating stuff in here, but it's WAY too short – this should have run for at least an hour, and in its present form almost feels like a trailer for the real thing. I'm assuming this was an EPK sent out to promote the film, and in that respect is way better than most, but it does leave you aching for more. Shot on DV in anamorphic widescreen.

There are five Deleted Scenes, none very long, some of which add character detail, but in at least one case the removal is understandable. Funniest is The Jury at Work, three minutes of cut jury deliberations, most of which are as amusing as the material that made it into the film. These are non-anamorphic widescreen.

Bloopers (7:23) is a neatly edited mix of cut shots and gaffs, presented non-anamorphic widescreen.

Development Work Featurette (7:13) is another case of a teaser for something that demands to be longer and have some structure. Primarily containing what appears to be two improvisations for scenes in the film, it suggests a Mike Leigh-style approach to the dialogue, where actors play off one another and the script emerges from that, but no confirmation of this or explanation of what is taking place is provided.

Bagpipes and Cornetas Featurette (15:02) actually feels complete and provides a structured and interesting look at the recording of the score in Seville. No surprise that it has camera and editing credits, though was clearly shot on mini-DV and includes a few too many shots done with the trace effect turned on (though some were presumably enforced by low light levels). This one is anamorphic widescreen.

Finally there is the Theatrical Trailer (2:01), which is neatly assembled, though does suggest this is a far more lightweight film than it actually is.

Festival has so remained a too-little seen film, though has managed to seriously divide opinion amongst those who have caught it, a couple of IMDB commentators describing it as the worst film they've ever seen (but these days that's an all too common cry and applied to just about any film that doesn't strike the commentator as "awesome"). Certainly it's not for everyone, but many of the film's detractors seem to have either misinterpreted its intentions (I've read a fair few moans that it's not a documentary-style look at the Edinburgh Festival), been offended by its content (and have then rather transparently made a point of trying to convince us that they have not been) or complained that the film is simply too cynical. TOO cynical? In my book, there's no such thing. With that comment in mind, it might be worth recalling the hundred-year-old words of the great Ambrose Bierce, who described a cynic as someone who "sees things as they are, not as they should be." Enough said.

Pathé's region 2 DVD features a pretty good transfer, very good sound and a sprinkling of interesting extra features that scream of incompletion, but with a special edition unlikely, this will do well enough.