The film is loosely inspired by the case of Wisconsin murderer and grave robber Ed Gein, who like Norman Bates was a solitary killer with a domineering deceased mother and a shrine-like sealed room in his house.

Hitchcock's assistant Peggy Robertson discovered Robert Bloch's novel through a positive review and brought it to Hitchcock's attention after Paramount's studio readers had already rejected it; Hitchcock then acquired the film rights for $9,500 and reportedly had her buy up copies of the book to preserve its surprises for readers.

When Paramount refused to give Hitchcock his usual budget, he offered to finance the film himself through his own Shamley Productions and shoot it cheaply in black and white using his Alfred Hitchcock Presents television crew, forgoing his usual $250,000 director's fee for a 60% stake in the film's negative instead.

Screenwriter Joseph Stefano initially found the novel's Norman Bates unsympathetic, since he was written as middle-aged and overweight, but became much more interested in the project once Hitchcock suggested casting Anthony Perkins in the role.

Stefano was in therapy dealing with his own relationship with his mother while writing the screenplay, which influenced his approach to the Norman Bates character.

To cut costs and to avoid making the shower scene too gory, Hitchcock chose to shoot Psycho in black and white, keeping the total budget under $1 million.

Throughout filming, Hitchcock secretly hid various versions of the 'Mother corpse' prop in Janet Leigh's dressing room closet as a running joke to keep her in suspense.

Anthony Perkins improvised Norman's habit of eating candy corn, one of several details the lead actors were allowed to invent as long as it didn't require moving the camera.

The Bates house's look was modeled on Edward Hopper's painting 'House by the Railroad', itself based on a Second Empire Victorian home in Haverstraw, New York; the exteriors were built on the same Universal stage used for Lon Chaney's The Phantom of the Opera (1925) and still stand on the studio backlot today.

The famous shower scene took about a week to shoot (December 17–23, 1959) and runs roughly three minutes, after Janet Leigh had twice postponed filming due to a cold and then her period.

Composer Bernard Herrmann refused to accept a reduced fee despite the film's low budget, then used that constraint to his advantage by writing for string orchestra alone instead of Hitchcock's requested jazz score, using muted strings throughout except in the shocking shower scene cue.

Hitchcock's traditional cameo appears about twenty minutes in, showing him standing outside Marion's workplace wearing a Stetson hat, reportedly timed so he could appear in the same scene as his daughter Pat Hitchcock, who played Marion's colleague.

Hitchcock introduced an unprecedented 'no late admission' policy, barring anyone from entering the theater after the film had started, a strategy theater owners initially opposed but which led to long lines once audiences embraced it.

British critic C. A. Lejeune was so offended by the film that she walked out before it ended and permanently resigned her post as film critic for The Observer.