According to Mike Myers, less than a month before the film was released, the producers made plans for a sequel based on the book's sequel, The Cat in the Hat Comes Back. However, Audrey Geisel, Dr. Seuss's widow, was so appalled by this movie that she decided to reject any future live-action adaptations of her late husband's work. The sequel was eventually canceled.
According to cast and crew, working with Mike Myers on this film was a "horrible, nightmarish experience." Actors would wait for hours for Myers to come out of makeup, he only spoke to his handlers and director Bo Welch during down time on set, he had his handlers dress his trailer, and his area was all covered with tenting because he didn't want anybody seeing him. He also had a male assistant who sole job was to feed him chocolates from a Tupperware container, and the film ended up having long and pointless additional takes of scenes because he overruled Welch on whether they were good enough or not.
For the character of the Cat, Mike Myers was inspired by the cartoon Top Cat (1961), Bugs Bunny, and Bert Lahr's Cowardly Lion in Le Magicien d'Oz (1939) - especially how the Lion's tail seemed to be a disconnected part of his body.
The downtown area outdoor shots were filmed along a Pomona, California street, where several antique and gift shops are located. The community decided not to redecorate after filming ended, so the surreal paint scheme, and some of the signage, can still be seen as it appears in the movie.
Some of the adult jokes in this film are actually rejected jokes from Le Grinch (2000). The "Seinfeld" writing trio of Alec Berg, Jeff Schaffer, and David Mandel did extensive rewrites on "The Grinch", after the original writing team, Peter Seaman and Jeffrey Price, were having trouble coming up with a compelling backstory for the Grinch character. "Grinch" director Ron Howard did not like some of the adult humor the trio wrote and cut it out of the script. Even though the Writers Guild of America denied the three onscreen credit, they were later hired to write this film.