To be directed by Mirrah Foulkes, the film follows two puppeteers, the vain but charismatic Punch and his resilient and talented wife Judy (Wasikowska) as they attempt to resurrect their show to escape their decrepit town of Seaside.
Film is "a crazy mix of fantasy, feminism and fanaticism", says Foulkes, according to the Hollywood Reporter.
The film will produced by Vice Media Australia and Blue Tongue Films.