Menzies joined Famous Players-Lasky, later to evolve into Paramount Pictures, working in special effects and design. He quickly established himself in Hollywood with his elaborate settings for Robin Hood, The Thief of Bagdad, The Bat, The Dove, Sadie Thompson, and Tempest. In 1929, Menzies formed a partnership with producer Joseph M. Schenck to create a series of early sound short films visualizing great works of music, including a 10-minute version of Dukas's The Sorcerer's Apprentice, and created the production design and special effects for Schenck's feature film The Lottery Bride. Menzies's work on The Adventures of Tom Sawyer prompted David O. Selznick to hire him for Gone with the Wind. Selznick's faith in Menzies was so great that he sent a memorandum to everyone at Selznick International Pictures who was involved in the production reminding them that "Menzies is the final word" on everything related to Technicolor, scenic design, set decoration, and the overall look of the production. "Production designer" was coined specifically for Menzies, to refer to his being the final word on the overall look of the production; it was intended to describe his ability to translate Selznick's ideas to drawings and paintings from which he and his fellow directors worked. Menzies was the director of the burning of Atlanta sequence in Gone with the Wind. He also re-shot the Salvador Dalí dream sequence of Alfred Hitchcock's Spellbound. In addition, Menzies directed dramas and fantasy films. He made two science-fiction films: Things to Come, based on H.G. Wells' work for producer Alexander Korda which predicted war and technical advancement; and Invaders from Mars, which mirrored many fears about aliens and outside threats to humanity in the 1950s.
At the first Academy Awards, held on May 16, 1929, Menzies won for Best Art Direction for The Dove and Tempest. The following year he was nominated in the same categories for his work on Bulldog Drummond, Alibi, and The Awakening, but lost to Cedric Gibbons. At the 12th Academy Awards held on February 29, 1940, Menzies won an Academy Honorary Award "for outstanding achievement in the use of color for the enhancement of dramatic mood" in the production of Gone With the Wind. In 2005, Menzies was in the first group of art directors and production designers inducted into the Art Directors Guild Hall of Fame.
In October 2009, Alpha Video released the public domain collection The Fantastic World of William Cameron Menzies on DVD, which included four early experimental films created by Menzies and Joseph M. Schenck, shorts that visualize great works of classical music:
"Irish Fantasy"
"Impressions of Tschaikowsky's Overture '1812'"
"Hungarian Rhapsody"
Paul Dukas' "The Wizard's Apprentice".
According to Dave Kehr, The Wizard's Apprentice "clearly influenced Disney's version in Fantasia.
