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The film's title card reads: "Rex Beach's The World in His Arms." The picture opens with the following written foreword: "History records the United States purchased Alaska on March 30, 1867. This was the realization of a dream that began many years before when Captain Jonathan Clark anchored his schooner, the Pilgrim of Salem, among a thousand abandoned ships that lay rotting in the harbor of...San Francisco 1850." Although in the film Jonathan Clark purchased Alaska for $10 million, U.S. Secretary of State William H. Seward actually bought the territory, then dubbed "Seward's Folly," in 1867 for $7,200,000.
Hollywood Reporter reported in July 1946 that Twentieth Century-Fox director Lloyd Bacon originally negotiated to buy the rights to the Rex Beach novel The World in His Arms, hoping to produce it independently with Gene Tierney as the star. International Pictures then bought the film rights for $100,000 about a week later. In February 1949, Universal-International announced that it would produce the property, which had been shelved for three years. An August 1950 Hollywood Reporter news item mentions Errol Flynn in connection with The World in His Arms, and Hollywood Citizen-News stated in March 1951 that Universal was considering Jeff Chandler for the starring role, but Louella Parsons reported in Los Angeles Examiner in July 1951 that Gregory Peck and Raoul Walsh, who had worked together on the 1951 Warner Bros. film Captain Horatio Hornblower (see AFI Catalog of Feature Films, 1941-50), sold themselves as a package to Universal for this film.
Some scenes were shot on location at sea off Nova Scotia. According to a Hollywood Reporter news item, special photography department head David S. Horsley used a new, time-saving method to process the Technicolor scenes in the picture. Usually, backgrounds were filmed with process plates which later had to be blended with footage of the actors. Instead, Horsley flooded a blank screen with special lights to cancel out all green tones, so actors could be shot without process plates and then backgrounds could be dubbed in at a later date. The Daily Variety review described the scenes as "some of the best sea footage ever put on film." Other Hollywood Reporter news items reported that the film marked the American film debut of British actor (and later director) Bryan Forbes; that Dave Kashner, who plays the whip man, was cast because of his whip expertise; and that Ann Blyth's stand-in, Alice Krasiva, played a role in the film. The Hollywood Reporter review identified Bill Radovich, who plays bulky Inuit "Ogeechuk," as an "ex-football star."
The World in His Arms had its premiere on the Elendorf Army base in Kodiak, AK in June 1952 as part of Universal's 40th anniversary celebration. According to a Hollywood Reporter news item, several sailors and marines were injured at the event when they stormed the theater.