By FRANCES ROBINSON ANNECY, France—Tourists flock to this medieval city at the foot of the Alps, where winding stone streets lead to breathtaking views across the Lake Annecy. In winter, skiers love its proximity to the slopes and wealth of fine restaurants. In summer, visitors sink into red-upholstered chairs in a darkened, windowless, room. There they watch, among other things, Canadians wishing they were donkeys and cats getting smacked in the face with skillets. Every year, 7,000 festival guests flock here for the world's biggest animation jamboree—the Annecy International Animation Film Festival—to see cartoons ranging from "Madagascar 3: Europe's Most Wanted" to Czech film shorts about the sexual fantasies of female tram drivers. What the festival doesn't have is paparazzi. "That's the thing about cartoon characters," said the festival's chief executive, Patrick Eveno. "You can't get them to walk down a red carpet." With an imaginary A-list, the festival audiences take center stage. "If they hate your film, they throw things at you," says Bill Plympton, an Oscar-nominated cheap burberry handbags director who's been attending for 14 years. And then there are those mountains. "The scenery's beautiful too," Mr. Plympton added. "Every morning I swim in the lake." Screenings often get rowdy. While films are readied for showing, audience members throw paper airplanes. Landing on the stage prompts whoops and cheers; any projectiles hitting the screen sends the house wild. Then, the reel starts to roll and the festival's rabbit logo gets the crowd chanting "Le Lapin, Le Lapin." With audience as well as jury prizes, the 229 films in competition—selected from thousands submitted—get unprecedented exposure. Each morning, festival artistic director Serge Bromberg hosts a breakfast where the directors of the short films in the competition take questions from festivalgoers over coffee and croissants. Guests in recent years have included Tim Burton, "The Simpsons" creator Matt Groening and "Toy Story" director John Lasseter. Founded in 1958, the festival is now an annual event that has grown to include a film market for industry professionals. But it's not your average film festival. The only thing resembling a VIP area is an Irish bar organized by this year's guest country. There are conferences where experts discuss topics such as "Clothes, hair and faces: a technical makeover" and top directors work on their portfolios alongside students. Mr. Bromberg said that as the event grows, it strives to keep the friendly feel of a decade ago, when a Dutch animation student talked his way into the opening screening at the last minute. He quickly found an English distributor for his work. The next year, he returned and proposed to her on stage. Organizers have no interest in becoming the Sundance of animation, and Mr. Bromberg said he has no jealousy for his friend who runs the well-known Cannes festival. "He's got all these stars, each one's making demands," Mr. Bromberg said. "It must be a total nightmare with 50 of them." Animation is often a solitary pursuit, and the festival not only gets filmmakers out of the studio, but draws artists from every discipline. Illustrator Steven Appleby, author of "The Coffee Table Book of Doom," had his work turned into a television series, in part thanks to the festival. "I love the bonkersness," said Mr. Appleby, toting a silver-sequin handbag. "You get this wonderful mix of creators from all over, and I'm usually a judge in the pedalo race." The afternoon before the festival prizes are awarded, the mood is relaxed. On the lakeside lawn, a picnic hosted Ferragamo handbags by composer Nik Phelps and his wife, Nancy Denney Phelps, is in full swing. The picnic is followed by a game of rounders—a British version of softball—and a pedalo race. None of this is part of the official festival; Ms. Denney Phelps, who sports chandelier earrings made of tiny glass chilli peppers, says the she loves the event and wanted to add to it. While water-pistols are fired and braver participants leap into the lake, a team of Dutch animation graduates powers round the island to take victory. "I'm an old romantic about Annecy; it's the films I like, and the film-makers rather than the marketplace," says affable Oscar-winner Peter Lord, while offering round a plate of ham. He recently finished directing "The Pirates! Band of Misfits," and is now looking for new projects to nurture. "You get to meet young, talented students and then we can suck the lifeblood out of them—I mean, get them started in this wonderful industry." Often, the dark subject matter of films is at odds with the jolly festival mood. This year, the prize for best feature film went to "Crulic—The Path to Beyond," a Romanian-Polish film about a prisoner dying of hunger strike in protest at an unfair trial. A special distinction was awarded to the short "Seven Minutes in the Warsaw Ghetto." For the closing ceremony, the stage is decorated to look like Mr. Bromberg's office. He's stepping down as artistic director after 14 years to be replaced by Canadian director jimmy choo handbags and producer Marcel Jean. With a festive air in the room, prizewinners are enthusiastically cheered—but that's where the resemblance to the Oscars ends. Most winners take the stage in jeans; some look distinctly nervous. They also have more to share than just thanking their agent and fans. "Let me give some advice to any of you thinking of animating a dead fish, or indeed any decomposing animal," says Carlo Vogele after winning an award for his stop-motion film of a sea bass lip-syncing to Enrico Caruso's recording of "Una furtiva lagrima" on its final journey from fish market to frying pan. "It will get really, really gross." Write to Frances Robinson at frances.robinson@dowjones.com