Before production started on this film, Ivan Passer and producer Paul R. Gurian went to Jeff Bridges' house to ask him if he would agree to play Bone. After both entered Bridges' property, the actor's dog, a big German shepherd, attacked Gurian, biting him on the jaw. Gurian nearly died. Bridges later confessed that, after this incident, he had no choice but to accept the role in order to avoid being sued for several million dollars.
Both Nick Nolte and Tommy Lee Jones were considered for Cutter. Tom Berenger tried to get the part but was repeatedly turned down.
Director Ivan Passer cast actor John Heard after seeing him in a Joseph Papp Shakespeare in the Park production of William Shakespeare's "Othello".
According to Allmovie, "The film was fortunate to fall into the hands of United Artists Classics, a new division of the company crippled by the financial disaster of La Porte du paradis (1980). UA Classics adroitly marketed Cutter's Way, riding a wave of rave reviews and good word-of-mouth among more discriminating filmgoers to modest box-office success." Jeff Bridges starred in both movies.