Produced by the National Film Board of Canada, the film uses the technique known as pixilation, an animation technique using live actors as stop-motion objects. McLaren created the soundtrack of the film by scratching the edge of the film, creating various blobs, lines, and triangles which the projector read as sound.
In the film, two men (Jean Paul Ladouceur and Grant Munro) live peacefully side by side in houses made of cardboard, but when a flower blooms between both their houses, they fight each other to the death over the ownership of the single small flower.
McLaren was motivated to create the film following a trip to the People's Republic of China:
"I was inspired to make Neighbours by a stay of almost a year in the People's Republic of China. Although I only saw the beginnings of Mao's revolution, my faith in human nature was reinvigorated by it. Then I came back to Quebec and the Korean War began. (...) I decided to make a really strong film about anti-militarism and against war." — Norman McLaren 
The version of Neighbours that ultimately won an Oscar was not the version McLaren had originally created. In order to make the film palatable for American and European audiences, McLaren was required to remove a scene in which the two men, fighting over the flower, murdered the other's wife and children.
During the Vietnam War, public opinion changed, and McLaren was asked to put the sequence back in. The original negative of that scene had been destroyed, so it was salvaged from a positive print of lower quality.
Neighbours is the winner of a Canadian Film Award as well as an Academy Award, where it was nominated twice, for Short Subject (One-reel) as well as Best Documentary (Short Subject). Strangely, it was in the Documentary category that this short, stylized drama won its Oscar. A press release isued by AMPAS states that Neighbours is "among a group of films that not only competed, but won Academy Awards in what were clearly inappropriate categories." 
This film has been designated and preserved as a "masterwork" by the Audio-Visual Preservation Trust of Canada, a charitable non-profit organization dedicated to promoting the preservation of Canada’s audio-visual heritage. 
- Norman McLaren. National Film Board of Canada. Retrieved on 2005-09-16.
- Cartagena, Rene (2003). Neighbours. Retrieved on 2006-08-30.
- Curtis, David. Norman McLaren. Edinburgh: Scottish Arts Council Catalogue, 1977.
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- AV Trust | Preserving Canada's Visual and Audio Treasures