The film was dedicated to Don Messick, the original voice of Scooby-Doo, who died in October 1997 after retiring from the role in 1996.

It was the first Scooby-Doo production to feature the entire adult gang together (minus Scrappy-Doo) since a 1984 episode of The New Scooby-Doo Mysteries.

The project began as a direct-to-video experiment suggested by Time Warner after Cartoon Network reruns boosted Scooby-Doo's popularity in the 1990s, and was considered a low-oversight one-off by studio executives, giving the crew creative freedom.

Much of the script was recycled from Glenn Leopold's screenplay for an unfinished SWAT Kats episode called 'The Curse of Kataluna'.

Director Jim Stenstrum and producer Davis Doi wanted the monsters to be genuinely supernatural rather than costumed villains, while writer Glenn Leopold wanted to keep the traditional solvable mystery format; model coordinator Lance Falk suggested combining both approaches, resulting in the film's mix of real supernatural threats and a mystery plot.

Casey Kasem was originally set to reprise his role as Shaggy, but he refused to voice the character eating meat due to his vegetarianism (having also refused a 1995 Burger King commercial for the same reason) and demanded Shaggy become vegetarian in future productions, leading the studio to recast the role with Billy West even after offering Kasem a last-minute chance to redub the part.

Heather North had already recorded a day's worth of dialogue as Daphne before being replaced by Mary Kay Bergman.

Frank Welker, the only original series actor to return (as Fred Jones), had to fight to keep his natural voice after producers believed it had dropped an octave; the crew eventually reviewed old episodes and realized the perceived pitch difference was due to Cartoon Network airing time-compressed, sped-up reruns.

The film was the first of four direct-to-video Scooby-Doo films animated overseas by the Japanese studio Mook Animation, whose directors Hiroshi Aoyama and Kazumi Fukushima went uncredited on the final picture.

Original Scooby-Doo character designer Iwao Takamoto, still on staff at Hanna-Barbera, advised on the production and personally storyboarded several Shaggy and Scooby interplay sequences, calling the film 'a good solid mystery.'

The crew updated the characters' 1960s-style wardrobe for a more modern look, giving Fred jeans and a vest instead of bell-bottoms and an ascot, and redesigning Daphne's and Velma's outfits, though the original 1960s attire appears briefly in the opening scene.

Rock bands Third Eye Blind and Skycycle contributed to the soundtrack, with Third Eye Blind performing the title track 'Scooby-Doo, Where Are You!' and Skycycle performing two original songs written by Glenn Leopold.

The film was backed by a roughly $50 million promotional campaign, at the time the largest in Warner Bros. Family Entertainment's history, including tie-ins with Campbell's Soup, SpaghettiOs, Wendy's, Lego, and a NASCAR paint scheme on Jerry Nadeau's Winston Cup car.

A 2022 Variety ranking named Scooby-Doo on Zombie Island the best entry in the entire Scooby-Doo franchise.