Parallel to the developments in feature filmmaking, another influential response to American dominance of British cinema emerged. The British documentary movement, led by the Scot, John Grierson (1898–1972), offered a distinctive riposte to Hollywood by focusing on fact and public information. While studying in the United States under a Rockefeller fellowship from 1923 to 1927, Grierson developed his interest in mass communication, in which he perceived the potential to educate the public and influence opinion. By making films that were not dependent upon box-office receipts, Grierson saw an opportunity to address social and political issues that were unlikely to be covered by the commercial film industry. At the same time, however, his reliance on government and industrial sponsors created restrictions on subject matter, and most of the films made under Grierson's auspices seem like public-relations exercises rather than cinema providing any sustained social or political analysis. Nonetheless, many critics see Grierson's influence as crucial in the development of British cinema. His approach to documentary filmmaking has positioned a "realist" orientation as one of the fundamental tenets of what is often identified as British cinema. This is in sharp contrast to some of the more escapist tendencies seen in many of the "prestige" productions of commercial cinema in Britain during the 1930s.
Grierson was the director of only one film, Drifters (1929), a documentary about herring fishing in the North Sea. In 1929 he helped set up the documentary film unit of the Empire Marketing Board under the direction of the board's secretary, Stephen Tallents. The development of such official and public-sector film units is a key component of Great Britain's cinema history and has served as a model for subsequent developments in both the public and private spheres. In 1933 the Empire Marketing Board was dismantled and the film unit was moved to the General Post Office. Following the outbreak of World War II, the unit was taken over by the Ministry of Information and became the Crown Film Unit. By 1940 Grierson was in Canada, where he helped found the National Film Board.
Despite its ties to the "real," the documentary film movement in Great Britain was in many ways an innovative form, concerned with aesthetics and a vital contributor to the development of an identifiable national cinema. With films such as Industrial Britain (1933), Grierson introduced a top-down, voice-of-god narration style whose purpose seemed to be public education. Industrial Britain was initially directed by Robert Flaherty, and Grierson had persuaded Gaumont-British to distribute the film. Unsatisfied with Flaherty's methods, however, particularly the American's tendencies toward lyrical images, Grierson took control of the film, shot additional material, and added the authoritative voice-over that is characteristic of his work. Two GPO films, Coal Face (1935), directed by Alberto Cavalcanti (1897–1982), and Night Mail (1936), directed by Harry Watt (1906–1987) and Basil Wright (1907–1987), make use of the poetry of W. H. Auden and the music of Benjamin Britten in an attempt to combine more formal aesthetic concerns in addition to addressing a sense of "Britishness." Two of the figures to emerge within the movement were Cavalcanti, who succeeded Grierson as director of the GPO unit in 1937, and Humphrey Jennings (1907–1950), whose early collaborations with Cavalcanti at the GPO were often criticized as too experimental. The Brazilian-born Cavalcanti had been involved with the French avant-garde cinema of the 1920s, while Jennings was a leading modernist and sur-realist with concurrent interests in painting, poetry, and theater, among other pursuits.
It was in his wartime documentaries that Jennings truly shone. His contributions to the Crown Film Unit's efforts are among the most memorable and critically discussed of the era. These include Listen to Britain (1942, with co-director Stewart McAllister), a film without commentary that instead relies upon associative montage to connect varied images through sounds, helping to create a sense of social cohesion through mass observation. Fires Were Started (1943) stretches the definition of documentary by presenting a fictional narrative shot in a documentary style so that it seems to capture the reality of London during the blitz. A Diary for Timothy (1945) comes after the end of the war but is without doubt a wartime documentary. The film uses the fictional diary of a baby, Timothy, who was born in 1944 and whose first year of life has been connected to the end of the war, to "observe" the nation while also addressing the future and reinforcing sense of community, the heart of all of Jennings's films.