"First you take the liver out, then you open the rib cage and take the innards out. Then you fill it with hot stones and aromatic herbs …" Ruggero Deodato is explaining how to eat a human being. Not that he's done it, or has he met anyone who has – but when it comes to cannibalism, the 72-year-old director is still something of an authority. In 1980, Deodato released what is still regarded in many quarters as the most controversial film ever made: Cannibal Holocaust, now being rereleased for home consumption, if that's the right word.

Cannibal Holocaust lived up to its billing in so many ways. The movie follows a team of American film-makers into the Amazon basin in search of a previous expedition, who disappeared investigating cannibal tribes. What we see is supposedly the footage recovered after they themselves disappeared. Cannibalism is just the dessert course. Before we reach the gruesome climax, we're served up a degrading onslaught of rapes, murders, torture, salacious sex, genocide, castration and even news footage of real-life executions.

Most notorious of all was Cannibal Holocaust's depiction of the slaughter of wild animals. That is the only part of the film Deodato regrets. "In my youth, growing up, I spent a lot of time in the country close to animals and therefore often seeing the moment of their death," he says. "The death of the animals, although unbearable – especially in a present-day urban mindset – always happened in order to feed the film's characters or the crew, both in the story and in reality." His latest edit cuts out some of these excesses, but still leaves plenty in.

More troubling, though, is the treatment of humans in Cannibal Holocaust. Despite Deodato's avowed support for indigenous peoples (he shot the movie on the border between Colombia and Brazil), none are credited, and there's little evidence of interest in their actual tribal customs. He is often accused of racism and exploitation, but he insists they were intelligent, co-operative collaborators. "Of course they understood they were being portrayed as cannibals," he says. "But it's part of their tradition. It's an ancestral thing. When they had a battle, the leader of the losing tribe would be killed and eaten by the winners. It's part of their past. They don't deny that."

The get-out is that the film-makers in Cannibal Holocaust are the real savages. They are shown goading, raping and even killing to get sensational footage for the media back home. In real life, though, Deodato was doing something suspiciously similar. "My producer in Italy was showing dailies in the film markets and getting an amazing response, so he was ringing me every day in the jungle telling me: 'Do more! Do more! Keep filming! Kill more people! Don't worry, your message will come though.'"

Deodato, who was assistant director on Sergio Corbucci's Django, was inspired to make the film after watching violent news reports in Italy with his young son. "It was the time of the Red Brigades. Every night on TV there were very strong images of people being killed or maimed. Not only killings but also some fabrications. They were increasing the sensationalism of the news just to shock people."

As a comment on shock value, Cannibal Holocaust succeeded all too well. Deodato was even put on trial in Italy on suspicion of murdering his actors – an accusation he disproved by bringing one of them to court. He was fined for animal cruelty, and the movie was banned for three years. It was banned in around 40 other countries, too, including the UK until 2001.

Whatever its sins, Cannibal Holocaust's influence has been acknowledged by directors from Oliver Stone to Quentin Tarantino, and across the horror world. Deodato is proud his film created the "found footage" genre. The fact that Cannibal Holocaust's content has been less imitated than its style can only be good news for humanity, censorship panels, the ecosystem and avant-garde cuisine.

Cannibal Holocaust: Ruggero Deodato's New Edit is released on DVD and Blu-Ray on 26 September.