"Don't eat the food!" A simple request. But in war torn Spain in the 40s with food as rare as violence was plentiful, the lure is too great. Taking even the smallest pair of grapes can have horrific consequences... Welcome to Guillermo del Toro's superb Pan's Labyrinth.

Within the Hollywood system, even the biggest hitters (especially the biggest hitters) are narrow-mindedly encouraged - by those who stand to profit leech-like from their talent - to do the same as or similar to what they've done before. It's the hold syndrome on a one armed bandit's winning line. Tom Cruise will never do ugly (Vanilla Sky was not Tom doing ugly, trust me - in that movie he enjoys relationships with both Cameron Diaz and Penelope Cruz, ugly, schmugly), Tom Hanks will never do indecent (he'll kill but never indecently) and Steven Spielberg - despite his eclectic choice of projects in his autumn years - will never shoot his own remake of Ai No Corrida. His agent - if he had one and I believe he has despite his lofty status - would be furious. But then there are those film-makers who are scrupulously honest to themselves artistically most of the time who brush against cinema's Vatican-like mountain of excess. Hollywood and big buck budgets must powerfully entice and for these film-makers' children's and grandchildren's education's sake, they sometimes buckle.

Having worked on big budget movies, Guillermo del Toro understood his friend's dilemma - fellow director Alfonso Cuaron - when he was asked to direct the hugely budgeted Harry Potter and the Prisoner of Azkaban. Those Warner execs are canny souls... Select a 'hip' director and you get industry credibility, a franchise kick up the ass and a reduced director's fee. Guillermo told Alfonso "Serve the story..." It was good advice. The independents soak in the budgetary freedoms and wastage and figure out how to maintain the former and reduce the latter. The artists soon realise that with practical ingenuity they can have total creative control AND budget their projects in a reasonable manner without the L.A. suits and overheads that would crush those without spines of steel. As absurd as this sounds, but del Toro's sumptuous and CGI riddled fantasy cost less than £10 million... I know that sounds like a lot of money (it is by any individual standards) but in film-making terms, it's low budget, low expectation... Low, low, low... You learn the way to budget properly from excess. The money wasted on a $100 million movie would make Gordon Gecko blush. Hell, the money wasted on a Hollywood behemoth would pay for Pan's Labyrinth...

Guillermo del Toro, once and conceivably again in the future, a Hollywood-working outsider director, has gone back to his native Mexico to make what everyone who can count considers his sixth and some others consider his best movie. I'd consider it too if I'd seen all of his oeuvre. But despite my del Toro Oeuvre ignorance, (I've sampled Mimic, Blade II and Hellboy) know this; Pan's Labyrinth is a superb piece of work with real emotional bite, a villain to hiss, a metaphorical conceit to dissect and savour, religious allegory to gnaw at in frustration and performances to cheer long after the curtain has closed. It is both an intellectual treat and a visceral punch in the solar plexus. I loved it. Can you tell?

It's June, 1944. That date should have resonance. If the Second World War could be reduced to a three act screenplay format, 1944 was at the end of the second act, the point at which the hero was at his/her lowest ebb... the time just before he/she realises that he/she will actually triumph. In Spain, the civil war was over at best and at worst fading out. It was a country looking to the world to have order and fairness thrust upon it. The world was pre-occupied. Spain was ignored. The old and brutal order was struggling. Morality in any war is moot. In war doing the right thing can be disastrous. Going to war in the first place is bad enough. But the civil guard captain, Vidal - the nominal husband to the heroine's mother - can safely be described as a complete, utter and absolute bastard. He has all the redeeming features of Joseph Goebbels, the patience Basil exhibits towards Manuel and an authoritarian cruelty in his acts of torture and murder that seems to delight him. In fact, all he seems to care about is the continuation of his name through his son whom he protects at any cost.

'At any cost' is a cliché bandied about a lot these days. Let me repeat it so you know I really do mean 'at any cost'. The problem is that his pregnant wife is the potential cost (his loathing of the vessel of his progeny is barely concealed) as is his step-daughter Ofelia who rightly detests him. The son - and Vidal has no way to know it will be a son - is still in the womb. This all too human monster dominates the film when he's on screen because he is so unspeakably vile. I mean this guy cuts mirrors with razors. Don't ask, but the resulting effect is to make you sit with your hands prayer-like between your legs and a face like a lemon grenade has just gone off in your mouth. We take his bad guy nature on board right up front and wait for a sign of just how nasty this guy can be. We do not have to wait long. Two men are captured accused of being part of the guerrilla resistance. They protest their innocence but Vidal is dismissive. The men's story turns out to be true but not before he horrifically kills the younger man with the blunt end of a bottle (there were "Euw!"s galore at the screening I attended as it is spectacularly brutal) and leaves us in no doubt of his nature.

But the key to the movie is its fantasy aspect (heavily emphasized in the trailer that makes Pan's Labyrinth look like Jim Henson's Labyrinth's younger sister and not a gritty war movie with a fairy or two). The trailer gives no hints at the awful brutality on offer so that came as a shock but not an unwelcome one. If I may pause to suggest that Quentin Tarantino is right when he says that human beings enjoy cinematic violence. It's not the actual enjoyment of the violence per se. It's the fact that we are massively grateful it's not happening to us and always intensely curious how other people deal with violence against them. In Sin City, the woman-eating fiend played by Elijah Wood, is dismembered and eaten alive by his own wolves. In fact, he didn't massively object even as the hulking Marv cut his head off. It was the actual violence that startled, the lengths to which Marv went to exact revenge. What was wholly unsatisfying was the fact the victim didn't squeal or even seem to suffer. This probably says a lot about me so I'll shut up now.

The unlucky and beleaguered mother of Ofelia (beautifully played with not one false note by Ivana Baquero) in Pan's Labyrinth is saved by magic wrought by the Pan of the title (actually just a 'faun' hence the Spanish title El Labertino Del Fauno). It's one of the few times that her daughter's magic infringes upon the reality of the war being waged by the civil guard. Both fantasy and 'reality' aspects of the movie are held mostly in parallel lines all throughout the movie. Yes, there is something of a 'threads coming together' at the climax but mostly both 'reality' and 'fantasy' are kept apart. Ofelia has been sent with her mother to a garrison in the woods. Vidal is adamant that his pregnant wife shall bear the child in his presence and how she got pregnant by such a vicious monster is beyond my comprehension. He shows as much warmth towards her as a mongoose to a snake. I can only imagine a union with a high ranking soldier would afford her and Ofelia some protection. She got that about as wrong as any human being could.

Just before arriving at the garrison, Ofelia spots a large flying stick insect. It follows the car and introduces itself, morphing into a fairy-like creature after seeing an illustration in one of Ofelia's beloved fantasy books. As far as I am aware, del Toro keeps the fantasies in Ofelia's mind only. It's ambiguous as to their reality but in these circumstances, Ofelia is better off being trapped in a room with a baby-eating demon than present at the disintegration of both country and family or 'the real world'. More of the demon in a while. The fairy takes Ofelia to a small, dilapidated labyrinth in which resides the faun, Pan. Superbly realised by make up, performance (take a bow Doug Jones) and some artful CG faun-feet, He tells of a legend that a young girl once left the labyrinth and the King, her father, still awaits her return. Pan asks Ofelia to perform tasks so that she might be reunited with her father-King. Ofelia's real father had already been killed. Each task is gross but enchanting, full of horror and yet glorious to look at. You have to take your hat off to an 11 year old girl watching a giant frog vomit itself inside out. But the real shocker is that pale skinned, no eyed character you've probably seen in the trailer. Again, Doug Jones is in the make up and again his impossibly thin legs are beautifully rendered CG creations. This creature eats babies and tempted by a sumptuous feast on his table, Ofelia breaks the rules and has two grapes. What happens next is... see the film.

The small rays of light in this dark movie are from two characters that are actively serving the rebel forces when not dealing with Vidal's upkeep. Mercedes, a touching and stone-hard performance from Maribel Verdú, is the housekeeper and surrogate mother to Ofelia. Her lover fights in the forest against her master's men. She has one of the air punching moments in the film, a violent moment that even a pacifist would find cathartic. Let's say it involves a lot of blood, a terrific piece of dialogue and the brief empowerment of those held down by happenstance. The second 'spy' for the good guys is the doctor (Alex Angulo) who sees his role to tend the sick and not just make sure Vidal's baby makes it into this world. He has an 'Euw' moment but it's a routine medical procedure. But in this situation, getting plastered and biting on a piece of wood was considered 'anaesthetic'. Euw...

As the war-makers' fortunes reverse, Vidal finds himself horribly compromised. The left wingers surge forward as Pan awaits Ofelia to complete her destiny. I found the climax moving and the magic wonderfully real. This is a film-maker who knows when and when not to trust people with mice. The CG work in the movie is glorious. One small thing. Cinema, images etc. The image that really made me go for this movie was the penultimate image of the trailer (the shot just before the title). It is a flash of white (right on the big music crescendo) and a small girl steps inside what I know now is a tree. You know how some images are just the right images? The right camera placement and lens selection, the right lighting, perfect movement etc. Well, take a look at this shot. Even the angle of the girl's arms at the elbows as she enters the tree is perfect. And the way she moves, right foot forward. If I could explain exactly why I think this is a glorious shot, I'd probably be able to read minds or some such but I will say this; it so perfectly captured the curiosity of childhood I almost barked with joy.

Pan's Labyrinth is an adult fantasy that is unflinching in every aspect. It's also poetic and wondrous and nasty in equal terms. That's a powerful combination. See it.