Somewhat related to that Keith Phipps essay Why Star Wars? (mentioned here a couple of days ago), Wired has an oral history of Industrial Light & Magic, the special effects shop founded by George Lucas to work on the movie:
Industrial Light & Magic was born in a sweltering warehouse behind the Van Nuys airport in the summer of 1975. Its first employees were recent college graduates (and dropouts) with rich imaginations and nimble fingers. They were tasked with building Star Wars’ creatures, spaceships, circuit boards, and cameras. It didn’t go smoothly or even on schedule, but the masterful work of ILM’s fledgling artists, technicians, and engineers transported audiences into galaxies far, far away.
As it turns 40 this year, ILM can claim to have played a defining role making effects for 317 movies. But that’s only part of the story: Pixar began, essentially, as an ILM internal investigation. Photoshop was invented, in part, by an ILM employee tinkering with programming in his time away from work. Billions of lines of code have been formulated there. Along the way ILM has put tentacles into pirate beards, turned a man into mercury, and dominated box office charts with computer-generated dinosaurs and superheroes.
And if you were wondering where it all went wrong, it was probably the precise moment George Lucas had this revelation:
I never thought I’d do the Star Wars prequels, because there was no real way I could get Yoda to fight. There was no way I could go over Coruscant, this giant city-planet. But once you had digital, there was no end to what you could do.