Guillermo Del Toro will co-direct “Guillermo Del Toro’s Pinocchio” with Mark Gustafson, animation director on “The Fantastic Mr. Fox,” as a 3D stop-motion animated production of the Jim Henson Company.

Del Toro told Variety that he plans to begin shooting in the summer of 2013. It’s the first time he’s directed an animated feature.

Story will be set in Italy between WWI and WWII. “It was when everyone was behaving like a puppet, except for puppets,” Del Toro said.

Del Toro disclosed in 2008 that he had began working on a Pinnochio project with Henson and Gris Grimly, who illustrated a 2002 version of “Pinocchio.” At that point, Grimly and Adam Parrish King were attached to co-direct; last year, Del Toro and Henson Co. announced that Grimly would co-direct with Gustafson.

Del Toro said Wednesday that he has gradually come around to the idea of co-directing due to the complexity of the project — which will require a year to shoot. He’s currently in post-production on “Pacific Rim” for Warner Bros. and is planning to work on a re-design for “Pinocchio.”

“Little by little, I realized that I should direct,” he added, noting that the story has had a profound influence on him — to the point of collecting puppets along with original art from Disney’s 1940 “Pinocchio.”

The story is by Del Toro, frequent collaborator Matthew Robbins and Grimly with Pinocchio embarking on a series of adventures and proving himself to be as indestructible as his love for his father. Robbins wrote the screenplay.

Inferno Entertainment will represent the property to international buyers at Cannes Film Festival.

Del Toro most recently served as exec producer of DreamWorks’ “Puss in Boots,” “Kung Fu Panda 2” and the upcoming “Rise of the Guardians” as well as creative consultant on “Megamind.”

Lisa Henson will produce for The Jim Henson Company with Del Toro and Jason Lust. Grimly and Gary Ungar will exec produce as will Bill Johnson and Jim Seibel of Inferno. Nick Cave will serve as music consultant.

“Guillermo has been so passionate about this project from its inception and it is an honor to have him bring his unique blend of live action and animation experience to this well-loved story,” said Lisa Henson, who’s CEO of the Jim Henson Company.

Del Toro said no casting decisions have been made but noted he’s considered Tom Waits for the role of Pinocchio’s father and Donald Sutherland for the role of the fox.

Pinocchio first appeared in the 19th century book “The Adventures of Pinocchio” by Carlo Collodi. Walt Disney produced the first feature version of the story with his animated “Pinocchio” in 1940.

“We thought the combination of beloved family friendly brands such as Pinocchio and The Jim Henson Company along with the visual and storytelling genius of Guillermo del Toro would have the makings of a film that can have tremendous worldwide box office appeal,” said Bill Johnson, co-chairman of Inferno International.

Recent credits for the Henson Co. include “Sid the Science Kid,” “Dinosaur Train,” “Wilson & Ditch: Digging America” and “Pajanimals.” Features include “The Dark Crystal,” “Labyrinth,” “MirrorMask,” and “Unstable Fables.”