Recreating a legendary music scene in a movie is a tricky thing to do. Casting actors to play the parts of well-known stars generally doesn't work — the fact that we know we're watching actors is too distracting. And replicating the energy and the atmosphere that made the scene so exciting requires a first-hand knowledge and a knack for the telling detail that most directors don't have.

This is not to say it can't be done: Alex Cox's 1986 film "Sid and Nancy" definitely nailed the angry anarchy of the late-'70s punk scene (although the actors playing Johnny Rotten and Sex Pistols manager Malcolm McLaren were, again, an unconvincing distraction); and Cameron Crowe pulled it off two years ago with "Almost Famous," a fond chronicle of the early-'70s hippie-rock period. (Crowe wisely didn't bother trying to depict the stars of the time.)

Now comes a wonderful new English movie called "24 Hour Party People," which documents the uproarious Manchester music scene of the 1980s, and the rise (and fall) of its reigning label, Factory Records, the home of such celebrated bands as the brilliant-but-doomed Joy Division (which morphed into New Order) and the wacked-out, Ecstasy-fueled dance act Happy Mondays.

The focus of the film is Factory's ultra-colorful cofounder, Tony Wilson, a Cambridge-educated TV host whose life is changed in 1976 when he attends a Sex Pistols show in Manchester (one of the few cities where the controversial Pistols were allowed to perform). It's a singularly inauspicious gig: only 42 people are in attendance, but among them are future members of the Buzzcocks, Simply Red, and the Stiff Kittens (later to become Joy Division).

Thrilled by the Pistols' electrifying music and unabashed snottiness, Wilson and a friend start up Factory Records, a new kind of record company. Wilson is a devotee of the Situationist International, a French art-and-politics group devoted to smashing all rules and, mainly, fomenting chaos and fun. Inspired (like Malcolm McLaren) by the Situationist ethic, Wilson decrees that Factory will not "own" its bands, and that the bands will retain all rights to their music. (This does not happen anymore.) Under the guidance of madman-producer Martin Hannett, the raw punk sound is transformed into a gleaming new style of enormo-beat rock disco, and — to Wilson's semi-surprise — actual hits start happening.

Naturally, given Factory's anything-goes business plan, and the unpredictable nature of the bands the label signs, there are problems along the way. Riding the wave of its 1980 post-punk anthem "Love Will Tear Us Apart," the members of Joy Division are just hours away from embarking on their first U.S. tour when frontman Ian Curtis hangs himself in his home. Re-aligned as New Order, the band releases a 12-inch single in 1983 called "Blue Monday," the dust-jacket of which is so expensively elaborate that Factory is guaranteed to lose money on every copy sold. Wilson doesn't care — he figures the record will probably stiff anyway. But "Blue Monday" goes on to sell more than 3 million copies worldwide, dealing the label a serious financial blow.

Proclaiming the need for a pleasure dome for the soon-to-be-liberated pop-culture masses, the Situationist writer Ivan Chtcheglov called for the construction of a "hacienda" that would feature "zones designed to alter the inhabitants' moods and perceptions." In 1984, Wilson and his partners opened a seminal Euro-dance club called the Hacienda, where star bands eventually gave way to star DJs, and the drug-soaked "rave" culture of the 1980s and '90s was born. (When the Hacienda was closed for lack of funds in 1992, Wilson — true to his anti-materialist convictions — invited the patrons to carry off all of the club's turntables and other equipment, and use it to make art of their own.)

This is a fabulous story, and "24 Hour Party People" captures it with rousing immediacy. Shot on digital video (by Robby Müller, who's also worked with Danish "Dogme" director Lars Von Trier), the film has the shaky-cam feel of a documentary. It's not, of course: the real-life characters are all portrayed by actors. But the Factory scene is now remote, and the musicians involved were largely unrecognizable even at the time (Factory album covers were famously devoid of band photos); so the use of actors is not at all jarring.

And what inspired performances they deliver. Steve Coogan, the English comic and writer who plays Tony Wilson, is monumentally suave and hilarious. (Caught by his wife receiving oral endearments from a hooker in the back of a van, Wilson tells his startled spouse, "This isn't what it looks like.") Sean Harris, cast as Joy Division's Ian Curtis, projects a brooding intensity that's riveting; and Danny Cunningham, as Happy Mondays frontman Shaun Ryder, is the very incarnation of out-of-control street-punk charisma.

"24 Hour Party People" is a music movie unlike any other I can think of. It's wickedly funny and poignant, too. (Some of the key characters, like Martin Hannett, didn't survive all the fun.) The film will eventually open across the country, but it makes its debut in New York and Los Angeles on August 9. If you love powerful original music, and if you've ever been affected by the hypnotic sweep and wallop of an exploding new pop scene, you really have to see it.

—Kurt Loder