Matt Howe, on his great website barbra-archives.com, provides us with the very latest on Barbra's new screen version of Gypsy:


Plot: Gypsy was a Broadway musical (1959) with tunes by Jules Styne, lyrics by Stephen Sondheim and book by Arthur Laurents. It originally starred Ethel Merman (pictured above, center) as Rose.
The Advocate provides a great summation:
One of the great backstage musicals, Gypsy is based loosely on the memoirs of stripper Gypsy Rose Lee, but the focal character is really her ambitious and often frustrated single mother. Mama Rose drags her daughters, Louise and June, to any gig they can get, even as vaudeville is dying in the 1920s. June, first as Baby June and then the adolescent Dainty June, is the star attraction, but when she goes off on her own (she eventually became a noted actress under the name June Havoc), Rose puts Louise out front. As Gypsy Rose Lee, Louise goes on to hit the heights of fame, accompanying her sexy dances with unexpectedly intellectual patter. Rose is left to wonder, in words written by Sondheim, “When is it my turn? Don’t I get a dream for myself?”
Songs include the classics: “Let Me Entertain You,” “Small World,” “Together Wherever We Go” and “Everything's Coming Up Roses.”
Gypsy has had several successful Broadway and London stage revivals with Angela Lansbury (1974), Tyne Daly (1989), Bernadette Peters (2003) and Patti LuPone (2008) all playing Rose.

Film History

Gypsy was made into a movie in 1962 with Rosalind Russell as Rose, Natalie Wood as Louise, and Karl Malden as Herbie. Directed by Mervyn LeRoy, the film was photographed by Streisand's first cinematographer, Harry Stradling. Malden, by the way, played Streisand's father in the 1987 film, Nuts.
Gypsy was filmed in 1993 as a made-for-television movie with Bette Midler as Rose, Cynthia Gibb as Louise, and Peter Riegert as Herbie. Directed by Emile Ardolino, this TV production adhered closely to the Laurents book. [Order the Midler Gypsy DVD from Amazon by clicking here.]

Streisand Film Version

In 1989, news began spreading of Streisand starring in a new film version of Gypsy with Madonna as Louise. The show's writers addressed it in the press. After the 1962 film, “the show was dead in stock,” Jule Styne explained. “It took almost 30 years to offset that lousy picture.” Writer Arthur Laurents said, “Not for all the money in the world will we let them make another film version of Gypsy.”
Flash forward to January 2011. News broke (i.e. leaked) that Warner Brothers and producer Joel Silver were developing a film version of the musical Gypsy for Barbra Streisand, who would star as Mama Rose and also produce the film.
Arthur Laurents, who wrote the book for the original Broadway show told the press that “now things are serious and a movie is truly in the works.” Laurents even mentioned that Tom Hanks would be a great addition to the cast as Herbie.

[Warner Archive Collection released the Blu-ray of the 1962 film version of Gypsy. Order here.]

Laurents was not a fan of the 1962 film version starring Rosalind Russell. Mr. Laurents said, “I would be very pleased if we had a different film version for the historical record.”
As for Streisand being too old for the role (she turned 70 in 2012), Laurents told the New York Times, “First of all, they can do magic in Hollywood. Second, does it really matter?”
Laurents, Stephen Sondheim (who wrote the show's lyrics) and the estates of Jule Styne (music) and Jerome Robbins (original Broadway director) had to approve a new film as they hold the rights to the original Broadway production.
Meanwhile, The King's Speech director, Tom Hooper, was interested in directing Streisand as Rose. (He ended up directing the film version of another Broadway musical, Les Miserables.)
Two months later, after speaking with Sondheim about the project, however, Laurents had changed his mind. Sondheim, Laurents told the press, “told me something that he got from the British — and it's wonderful. He said, 'You want a record because the theater is ephemeral. But that's wrong. The theater's greatest essence is that it is ephemeral. You don't need a record. The fact that it's ephemeral means you can have different productions, different Roses on into infinity.' ” Laurents, therefore, concluded, “So I don't want it now. I don't want a definitive record. I want it to stay alive.”
A week or so after Laurents made it sound like the project was over, it was reported that Universal was interested in the property. Then, sadly, Laurents died on May 5, 2011 at the age of 93.
In May 2011, Gypsy film producer Joel Silver told the New York Times that Laurents gave his blessing (and his signature) to the film version of Gypsy before he died, calling for the film to be “substantially similar” to the stage musical. “I last spoke to Arthur in April,” Silver said, “brought him up to speed on everything, and then I think I surprised him a little by asking him to make the movie with me. I felt that he understood ‘Gypsy’ better than anyone, and that he understood Barbra, since he cast her in her first big musical, ‘I Can Get It for You Wholesale.’ And he said yes. We were talking about him coming out to L.A. in May.”
“We just have to find our team and a writer,” Streisand told USA Today in August 2011.
Julian Fellowes was named as Gypsy's screenwriter in March 2012. The press release from Universal Films read:

Producers Barbra Streisand and Joel Silver have set Academy Award®-winning writer Julian Fellowes to pen the screenplay adaptation of Stephen Sondheim and Arthur Laurents’ Tony Award winning musical, Gypsy, which Ms. Streisand and Mr. Silver are currently developing for Universal Pictures. Ms. Streisand will portray “Momma Rose” in the new version

N.Y. Post's Page Six reported in October 2012 that producer “Silver’s been trying to put together financing for his version of Gypsy with Streisand starring as Momma Rose. We’ve heard Streisand won’t fully commit unless Silver has the finances together, but backers are reticent to fork over the funds unless Streisand is fully aboard.”
Vanity Fair's December 2012 story on Julian Fellowes characterized his screenplay as “a big-screen reconceptualization of Stephen Sondheim and Arthur Laurents’s Gypsy.”
And Joel Stein's December 2012 story on Streisand contained this tantilizing sentence: “she told me she’s thinking of casting Lady Gaga as the lead in her remake of Gypsy.”
Streisand later recanted her statement about Gaga when she spoke with Entertainment Weeky's Marc Malkin. She said she "got into trouble for mentioning" Gaga and that "It was an idea."
If cast, Gaga would play Louise, who transforms during the movie into the stripper Gypsy Rose Lee.
As for directing and starring in the picture, "I don't know if I would direct it. I'm not sure about that," Barbra said to Marc Malkin.
Streisand told more to the press about her Gypsy project in December 2012:

• She is “still working out one rights issue” before the movie can move forward and that “it should happen, but it just takes forever.”
• “Age is just a number,” she told Entertainment Weekly about being too old to play Rose. “Some people look old at 45. Some people look younger at my age…. I saw CGI of an actor that made him go from 60 to 30, by the way. What they can do now, technically.”

"I hope it comes to fruition," Streisand said about Gypsy.