Bugsy Malone was released in the UK on 23 July 1976 (and later in the year in the US.
According to writer/director Alan Parker (making his feature film debut), he would tell his 4 children stories about a gangster named Bugsy Malone on car rides in the English countryside, and his son told him he should make a movie, with kids as the heroes.
Parker cast Scott Baio (making his feature film debut, and just before he was cast on Happy Days), even though (or because) Baio threw down his script and stormed out of the audition (according to Baio, "I wanted to play with my friends after school, but it happened to be raining that day, so I went to the city to meet with Alan Parker. . . So I sort of read the script, threw it at him, and walked out the door. That was it: I’d gotten the part before I got home.") and Jodie Foster (just before she was cast in Taxi Driver), with Parker impressed with Foster's professionalism (Foster had been appearing in commercials, film, and TV since she was 3), "I think she directed me as much as I directed her. She was extremely knowledgeable of the filmmaking process—she could have complicated technical conversations with the camera crew and script supervisor that were beyond her years. Even then, when she was twelve, I joked that if I got sick, she could take over."
In an odd movie full of odd choices (pedal cars, guns that shoot whipped cream), one of the oddest is dubbing the kids's singing voices with adults. Parker hired to Paul Williams to write the songs (he would win the Academy Award for "Evergreen" for A Star is Born, released in December 1976) and Williams insisted that adult singers (himself included) be used. Both Parker and Williams regretted the decision.
Bugsy Malone was a hit in the UK (and received 9 BAFTA nominations, including Best Film and Best Direction. Parker received the award for Best Screenplay, and Jodie Foster received Best Supporting Actress for Bugsy Malone and Taxi Driver), but did not find an audience in the US.