The film was an international co-production among companies from Germany, Austria, Hungary, and Canada. It won three European Film Awards, including Best Actor for Fiennes, and three Canadian Genie Awards, including Best Motion Picture.
The mid-19th-century patriarch of the Hungarian-Jewish Sonnenschein ("Sunshine") family is a tavern owner who makes his own popular distilled herb-based tonic in Austria-Hungary. The tonic, called Taste of Sunshine, is later commercially made by his son, Emmanuel, bringing the family great wealth and prestige. He builds a large estate where his oldest son, Ignatz, falls in love with his first cousin, Valerie, despite the disapproval of Emmanuel and Rose. Ignatz, while studying in law school, begins an affair with Valerie. Ignatz graduates and later earns a place as a respected district judge, when he is asked by the chief judge to change his Jewish surname in order to be promoted to the central court. The entire generation – Ignatz, his physician brother Gustave and photographer cousin Valerie – change their last name to Sors ("fate"), a more Hungarian-sounding name. Ignatz then gets promoted when he tells the Minister of Justice a way to delay the prosecution of corrupt politicians.
In the spring of 1899, when Valerie becomes pregnant, she and Ignatz happily marry before the birth of their son, Istvan. Their second son, Adam, is born in 1902. Ignatz continues to support the monarchy, while Gustave pushes for a communist revolution. Both brothers enlist as officers during World War I. In the days after the war, Valerie briefly leaves him for another man, the liberal monarchy collapses, and Ignatz loses his judicial position under a series of short-lived socialist and communist regimes. When a new monarchy emerges and asks Ignatz to oversee trials of retribution against the communists, he declines and is forced to retire. His health deteriorates rapidly and he dies, leaving Valerie as head of the family.
Istvan and Adam both join the Jewish-run Civic Fencing Club. Adam becomes the best fencer in Hungary, and General Jakofalvy invites him to convert to Roman Catholicism in order to join the nation's top military, non-Jewish, fencing club. While Adam and Istvan are converting, Adam meets Hannah, who is converting at the request of her fiance, and woos her into marrying him. Adam wins the national fencing championship two years in a row and goes on to lead the national team to the 1936 Olympic gold medal in Team Sabre in Nazi Germany, becoming a national hero in Hungary. Istvan's wife, Greta, pursues Adam until they start a secret affair.
New Hungarian laws are passed discriminating against people with any near Jewish ancestors, and the Sors family is initially shielded by the exceptions in the laws. However, Adam is soon expelled from the military fencing club. Greta finally convinces the family that they must emmigrate to save their children, but they are too late to get exit visas.
When Germany occupies Hungary, Valerie and Hannah are immediately moved into the Budapest Ghetto. Hannah escapes and hides in a friend's attic, but Hannah later dies in a concentration camp. Adam and his son Ivan are sent to a labor camp, and Adam is soon tortured to death. Istvan, Greta and their son are summarily shot by Nazis.
After the war, the surviving Sors family returns to the Sonnenschein estate. Gustave is invited into the communist government, Valerie manages the household, and Ivan becomes a state policeman, working for police Major General Knorr rounding up fascists from the wartime regime. Ivan rises quickly in the communist ranks and begins an affair with Carole, the wife of a high-ranking communist official. Later, Army General Kope asks Ivan to start vigourously arresting Jews, including Knorr, who are suspected of inciting conspiracies against the current government. After Gustave dies, Kope informs Ivan that his uncle would have been next to be investigated.
When Stalin dies in 1953, Ivan feels guilty for helping Kope and not saving Knorr. He leaves the police force and swears to fight the communist regime. In the Hungarian Revolution of 1956, he steps up as a leader, but is imprisoned after it fails. Released at the end of the decade, he returns to live together with Valerie in a single room of the former family estate. She falls ill while they search for the tonic recipe—after she dies, he fruitlessly continues the search. Ivan changes his name from Sors back to Sonnenschein, and concludes his storytelling after the 1989 end of the communist regime.
Psychologist Diana Diamond identified themes in the film as "Trauma, familial and historical", and how it has lasting effects on the individual's psychology. The character Ivan's status as narrator reflects this theme, as he witnesses Adam's death in the concentration camp. In exploring the relationship between Ignatz, Valerie and their brother Gustave and alleged adultery, the film portrays "Oedipal rivalries" and incest. The film also addresses the question of identity. Vladimir Tumanov, Professor of Literature and the Bible, wrote that, while brewer Emmanuel Sonnenschein does not completely reject either his Jewish heritage or Hungarian life, his descendants falter on this compromise, with Ignatz abandoning the name Sonnenschein and becoming fiercely loyal to Emperor Franz Joseph. Each generation goes ever further in repeating this pattern of moving into positions of "gentile power" by denying their Jewish name and religion and peoples, only to be attacked and even killed for being Jews, while also repeating a pattern of "the dysfunctional sexual life of the Sonnenschein" generations. Author Christian Schmitt adds Sunshine may also strive to add a message of hope to the tragedies of history.
Professor Dragon Zoltan writes the film starts by contrasting the title Sunshine with clouds as a backdrop, to communicate a force standing in the way of the sunshine. He argues the name of the family's brand, Taste of Sunshine, which is also the literal translation of the film's Hungarian title, suggests that the family's happiness stays with those who have tasted it, even after it is finished. The name Sonnenschein is also said in the film to underline the family's Jewish background, while Sors (fate) maintains the first two letters while erasing the Jewish traces. Ivan becomes a Sonnenschein again after reading a letter telling him how to live, representing the lost recipe of the family brand.
Although the story is a work of fiction, the film draws inspiration from historic events. The Sonnenschein family's liquor business was based on the Zwack family's liquor brand Unicum. One of Fiennes's three roles is based at least partly on Hungarian Olympian Attila Petschauer. Another role in the film which is similar to that of a historic person is the character Andor Knorr, played by William Hurt, which closely resembles the latter part of the life of László Rajk. Sonnenschein itself was a name in director István Szabó's family.
Hungarian-born Canadian producer Robert Lantos aspired to help make a film reflecting his family background of Hungarian Jews. Sunshine was his first project after leaving the position of CEO in Alliance Films.
Szabó shared his idea for the story with Lantos, a friend, in a restaurant, and Lantos was interested. Szabó submitted a screenplay of 400 pages in Hungarian, with Lantos persuading him to condense it and translate to English. The budget was $26 million.
Shooting took place mainly in Budapest. The Berlin Olympics scene was shot in Budapest and required 1,000 extras. The exterior of the Budapest estate of the Sonnenschein family, with a large mansion and distillery, was filmed at an apartment building at 15 Bokréta Street (Bokréta utca 15), in the city's central Ferencváros district. The filmmakers painted a sign near the top of the building's façade to identify it, for purposes of the story, as belonging to "Emmanuel Sonnenschein & tsa. Liquer" (where tsa. translates to co., for Company). In July 2008, director Szabó and cinematographer Koltai were on hand as invited guests for the grand re-opening of the apartment complex, as the municipal and district governments chose to maintain the fictional company name on the façade and officially name it The Sonnenschein House, after the governments spent 300 million forints renovating the building. Interior shots of the family mansion were filmed at a nearby building, on Liliom Street.
Fiennes described Szabó as very specific in how scenes were staged and how performances were given. On some shooting days, Fiennes would play all three of his characters, particularly if a specific location was only available for a limited time.
The film premiered in the Toronto International Film Festival in September 1999. Alliance Atlantis distributed the film in Canada. It opened in Vancouver, Toronto and Montreal from December 17 to 19, 1999.
This was followed by a release in Munich and Budapest in mid-January 2000, with a wider release in Germany, Austria and Hungary later that month. In February 2000, it was showcased in the 31st Hungarian Film Week, held in Budapest, where it won the Gene Moskowitz Best Film award. After U.S. screenings in summer 2000, Paramount Classics re-released it in New York City and Los Angeles on 1 December to promote Sunshine for the Academy Awards.
On the opening weekend in the Canadian limited release, the film made $42,700. In its first 19 days, the film grossed $300,000 in Canada, with expectations that if the film made a profit, it would be due to international screenings, TV rights and VHS and DVD.
By 25 November 2000, it had made $1 million in Canadian theatres. The film finished its run after grossing $5,096,267 in North America. It made $2,511,593 in other territories, for a worldwide total of $7,607,860.
Roger Ebert gave Sunshine three stars, calling it "a movie of substance and thrilling historical sweep". In Time, Richard Schickel remarked on the irony of the title in a film that conveyed how history devastates people. National Review's John Simon praised Szabó's direction, Lajos Koltai's cinematography and especially the performances of Ralph Fiennes and the supporting cast. In The New Republic, Stanley Kauffmann compared Szabó favorably to David Lean in a cinematic treatment of history, and despite the long runtime, "Sunshine is so sumptuous, the actors so refresh the very idea of good acting, that we are left grateful".
In The New York Times, A.O. Scott assessed the film as occasionally awkward, but wrote it made the viewer think. Michael Wilmington of The Chicago Tribune gave the film three and a half stars, praising it for its aesthetic photography and defending Fiennes for "deep understanding, burning intensity and rich contrast". Time later placed it in its top 10 films of 2000.
Sunshine received 14 nominations at the 20th Genie Awards, following the Academy of Canadian Cinema and Television's decision to revise rules allowing films with only a minority of Canadian involvement in production to compete, with also allowed Felicia's Journey to be nominated for 10.