The cinema as a cultural institution has been studied by academic researchers in the arts and humanities. At present, cultural media studies are the home to the aesthetics and critical analysis of film, film history and other branches of film scholarship. Probably less known to most is that research psychologists working in social and life science labs have also contributed to the study of the medium. They have examined the particular experience that motion pictures provide to the film audience and the mechanisms that explain the perception and comprehension of film, and how movies move viewers and to what effects. This article reviews achievements in psychological research of the film since its earliest beginnings in the 1910s. A leading issue in the research has been whether understanding films is a bottom-up process, or a top-down one. A bottom-up explanation likens film-viewing to highly automated detection of stimulus features physically given in the supply of images; a top-down one to the construction of scenes from very incomplete information using mental schemata. Early film psychologists tried to pinpoint critical features of simple visual stimuli responsible for the perception of smooth movement. The riddle of apparent motion has not yet been solved up to now. Gestalt psychologists were the first to point at the role of mental structures in seeing smooth movement, using simple visual forms and displays. Bottom-up and top-down approaches to the comprehension of film fought for priority from the 60s onwards and became integrated at the end of the century. Gibson’s concept of direct perception led to the identification of low-level film-stylistic cues that are used in mainstream film production, and support film viewers in highly automated seamless perception of film scenes. Hochberg’s argument for the indispensability of mental schemata, too, accounted for the smooth cognitive construction of portrayed action and scenes. Since the 90s, cognitive analyses of narration in film by film scholars from the humanities have revolutionised accounts of the comprehension of movies. They informed computational content analyses that link low-level film features with meaningful units of film-story-telling. After a century of research, some perceptual and cognitive mechanisms that support our interaction with events in the real world have been uncovered.