In Hollywood, you never know who you might run into. In a warehouse filled with “Star Wars” props and puppets, standing at the door of an Anzellan ship, was one of the stars of “The Mandalorian and Grogu”: Grogu himself (Baby Yoda to some), green, wrinkly, and undeniably cute.

“The cute stuff in ‘Star Wars’ tends to be a little weird-looking,” said director Jon Favreau. “It’s not like ‘Disney cute,’ it’s ‘Star Wars cute.’ And so, he’s got weird little hairs and sharp little teeth in there and wrinkly skin, and claws!”

As Favreau showed us, that’s by design: “There’s an analog, handmade feel to a lot of the characters and a lot of the costumes and a lot of the puppets from ‘Star Wars,'” he said. 

In the “Star Wars” universe, Favreau is a force. In 2019 he created the Disney+ show “The Mandalorian,” a space western with a blaster-wielding bounty hunter who protects the tiny but powerful alien Grogu. Favreau’s new movie is based on the show. “The Mandalorian and Grogu,” which comes out this week, is the first “Star Wars” film to hit theaters in nearly seven years.

And apologies to Pedro Pascal (who plays the Mandalorian), but his costar tends to steal every scene. 

Favreau says he didn’t anticipate how much the character of Grogu would blow up: “We knew it would be exciting,” he said. “We didn’t realize quite what a phenomenon it would be. And then when we saw the balloon in the Macy’s Thanksgiving Day Parade, that’s when it kind of – as a New Yorker – it really hit me. Like, ‘Wow! This has really hit another level.’ The whole thing’s surreal.”

To a young Favreau growing up in Queens with his father (his mother died when he was 12), Hollywood really felt like a galaxy far, far away. “I didn’t know what I wanted to do,” he said. “I didn’t think being an actor or doing artwork or any of that was a realistic possibility.”

Was it even in his dreams? “I don’t think so,” he said. “I liked doing it, like, in a school play, but I just didn’t live in a world where that was a possibility. Fortunately I had, you know, people in my life like my dad. He was a schoolteacher but loved what he did. And I learned early on that you should expect that of a life and of a career.”

So, he dropped out of college and started taking improv classes in Chicago, and at age 26 was cast in the football classic “Rudy.” “It was a really inspiring film,” he said. “I thought, once I was discovered with that, that you wouldn’t look back.” But despite getting an agent and going on auditions, he said, “it didn’t really pop for me.”

He got a few small parts here and there (including playing a clown on “Seinfeld”), but Favreau seemed destined to be just another struggling Hollywood actor, until he took the advice “write what you know,” and turned all that rejection into his first screenplay: “Swingers,” which became a movie with his buddy Vince Vaughan. “It was really a snapshot of where we were living in Hollywood as out-of-work actors,” Favreau said. “A lot of the dialogue either came from or was inspired by conversations that we had had. Movie didn’t make a lot of money, but it opened a door for a lot of us to pursue careers in a more meaningful way.”

Favreau had enough juice to start directing. “Elf,” starring Will Ferrell, was just his second feature behind the camera. “The hope was, could this be something that could join the pantheon of other movies like ‘Christmas Story’ or ‘Rudolph the Red-Nosed Reindeer’ or ‘Charlie Brown,’ that show every year, that become part of the tradition?” he said. “Not just here, but around the world, people know that film.”

The success of “Elf” led to another huge directing job: 2008’s “Iron Man,” with Robert Downey Jr as the wise-cracking billionaire Tony Stark. Asked if his improv skills came into play with “Iron Man,” Favreau replied, “Yeah, always. Because in film, you just need a moment, you just need a twinkle of the eye or an unexpected delivery of a line or a reaction, and that breathes life into this.”

Some say Favreau’s style – mixing cutting-edge technology with crowd-pleasing characters – made him one of Hollywood’s safest bets for big-budget spectacles like “The Jungle Book.” He said, “Especially when you have a very effects-driven genre, you want to have moments of spontaneity, inspiration, humanity, ’cause at the end of the day, people just care about people. That’s what they focus on: That human interaction, those emotional relationships.” 

And that human connection (even between aliens) is what Favreau thinks makes “The Mandalorian and Grogu” click, given the father-son relationship that develops between the Mandalorian and Grogu. “Father-son relationships have always been a big part of ‘Star Wars,'” he said. “This is one of the most positive father-son relationships in ‘Star Wars,’ and, ironically, they’re not related in any way. But it is a family of choice, and ‘Star Wars’ has always been about families coming together.”

After all, Favreau, who’s 59, still remembers watching the original “Star Wars” with his family. With this movie, he’s hoping other families get to make memories, too.

He says when he was a kid watching “Star Wars” in a theater, the thought that he would direct a “Star Wars” film himself one day would have been “unfathomable.” “To get the opportunity to do ‘Star Wars’ for the big screen, it feels like you’re getting a shot to pitch in the World Series,” Favreau said. “I’m excited to introduce a whole new audience to ‘Star Wars.'”

WEB EXCLUSIVE: Watch an extended interview with Jon Favreau (Video)

To watch a trailer for “Star Wars: The Mandalorian and Grogu,” click on the video player below:

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Story produced by David Rothman. Editor: Steven Tyler.