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The opening credits read: "Metro-Goldwyn-Mayer presents Jeanette MacDonald and Nelson Eddy in Victor Herbert's Sweethearts photographed in Technicolor." The film incorporates many musical numbers from Victor Herbert's operetta Sweethearts, but the present-day setting for the main story was original to the screen. A written epilog to the film states: "In our screenplay certain dramatic liberties have been taken with the operetta Sweethearts; we depict the scenes from the operetta as though it was a recent production currently presented by a wholly ficticious producer Felix Lehman and as composed and written by two wholly imaginary persons Oscar Engel and Felix Lehman whereas the stage operetta Sweethearts was actually written and produced on the stage about 1913; Victor Herbert composing the music and Fred de Gresac, Robert B. Smith and Harry B. Smith writing the book and lyrics."
Sweethearts was M-G-M's first three-strip Technicolor feature film, and the first color film for either Jeanette MacDonald or Nelson Eddy. According to contemporary news items and production charts, filming began on June 17, 1938 in black-and-white. After two days, however, the production was interrupted, all of the black-and-white footage was scrapped and filming began again in Technicolor. Hollywood Reporter news items note that M-G-M decided to make Sweethearts its first Technicolor film because of delays involved in preparations for Northwest Passage, which was originally intended as M-G-M's first Technicolor production. Other news items note that retakes of some earlier scenes, and at least one of the musical numbers, were directed by Robert Z. Leonard beginning in mid-August 1938 when W. S. Van Dyke II was otherwise engaged on preparations for Northwest Passage. According to a Hollywood Reporter news item on July 13, 1938, noted conductor-pianist Jos Iturbi was to make his acting debut in Sweethearts. He was not in the released film, however, and it is unclear if his role was cut or never filmed. Iturbi, who did not make his screen debut until 1944, appeared in several M-G-M films of the decade. Sweethearts was nominated for two Academy Awards, one for Best Sound and one for Herbert Stothart for Best Score. In addition, Oliver Marsh and Allen Davey won a special Oscar for color cinematography. Reviews pointed out the effectiveness of the color in the picture, especially in capturing the brilliant golden red color of MacDonald's hair. MacDonald and Eddy recreated their roles for a 1946 Screen Guild radio broadcast.