Produced by Sreeramulu Naidu under the banner of Pakshiraja Studios in Malayalam, Tamil and Telugu, ‘Kanchana' was the screen version of a popular Tamil novel ‘Kanchanayin Kanavu', authored by Tripurasundari, popularly known by her pen name ‘Lakshmi'. The novel serially published in the Tamil weekly ‘Ananda Vikatan' got widespread acceptance and appreciation from the readers for the morals it conveyed. The popularity of the novel prompted Sreeramulu Naidu to produce the film based on this story. All the three versions did well at the box office. The Malayalam version, released in October 1952, was a huge hit.

Prominent stars from Tamil, Malayalam and Telugu were part of the starcast. The legendary singing star K. R. Ramaswamy, and others like Miss Kumari, Padmini, Lalitha, Aranmula Ponnamma, M. N. Nambiar, P. A. Thomas added value to the film.

The film was shot at the splendid sets of the Pakshiraja Studios. Directed by Sreeramulu Naidu, the camera was handled by the renowned cameraman Sailen Bose. The dances choreographed by Guru Gopinath was an added attraction. Music composed by S. M. Subbiah Naidu dispensed with the practice of imitating popular tunes.

The film threw light on some social evils of the time like polygamy, injustice and discrimination towards women etc. The dialogues penned for the Malayalam version by Munshi Paramu Pillai, along with Manikyam, was impressive. The film dispensed with the usually irrelevant comic scenes.

Pushpanathan (K. R. Ramaswamy) takes over as Zamindar of Mathur. His widowed mother Ponnammal (Aranmula Ponnamma) wants her son to lead a peaceful life looking after the agricultural lands owned by the family. But Pushpanathan is persuaded by his college mate Manohar (M. N. Nambiar) to start a textile mill. Manohar's wicked eye is on the wealth of Pushpanathan.

Manohar introduces Pushpanathan to a dancer in the city, Bhanumathi (Padmini). Daughter of a prostitute Bhanumathi leads a honourable life, quite against the wish of her mother. Bhanumathi is in love with Pushpanathan. Manohar manages to manipulate and divert Pushpanathan's wealth in the cover of the setting up the textile mill.

Neelamegham Pillai (K. Doraiswamy), the former accountant of the Mathur Zamindar, now lives in utter poverty, struggling to bring up his grand children Kanchana (Lalitha) and Sabeshan (P. A. Thomas), who is studying for Medicine. Pushpanathan comes to help the old servant of his family and he becomes enamoured by Kanchana. Shortly afterwards, Pushpanathan weds Kanchana. He assures Bhanumathi that his marriage will not affect his love for her.

Kanchana who had dreamt of a luxurious and happy life as the Zamindar's wife is ill-treated by her mother-in-law. And she is heart-broken when she comes to know of her husband's relationship with Bhanumathi.

The financial crisis caused by the borrowings for the construction of the textile mill and domestic worries disturbs Pushanathan's peace of mind. At this juncture a young lady doctor, Seetha (Miss Kumari) comes to Mathur. Pushpanathan is drawn to her. But Seetha is in love with Kanchana's brother and her college mate doctor Sabeshan.

Kanchana burns with suspicion and jealousy. To add insult to injury, Pushpanathan beats Kanchana in the presence of Seetha. Disapproving of Pushpanathan's amorous approaches Seetha leaves Mathur. Pushpanathan vents his anger against Kanchana, who, unable to take it anymore leave home. Pushpanathan does not allow Kanchana to take her son with her.

Doctor Sabeshan misunderstands Seetha and leaves the village. Ponnammal gradually begins to realise what the value of Kanchana. She asks Pushpanathan to bring Kanchana back. Even Bhanumathi pleads with Pushpanathan to bring his wife back home.

Bhanumathi dies. All her wealth is transferred to Kanchana's son. Pushpanathan brings Kanchana home. All misunderstandings are cleared. Sabeshan weds Seetha.

The important characters were well handled by the experienced artistes like K. R. Ramaswamy, Lalitha, Padmini, Miss Kumari etc.

All the eight songs, penned by Abhayadev and tuned by S. M. Subbiah Naidu, became instant hits. A composition of Muthuswami Dikshithar , ‘Maye thwam yaahi...' in Tharangini raga and sung by M. L. Vasanthakumari became a super hit. Another composition of Dikshithar in Kalyani raga and sung by Vasanthakumari, ‘Shivakameswari...' also became a hit. The romantic number, ‘O! Vaanin mele...' (P. A. Periyanayaki) and a prayer song sung by Radha-Jayalakshmi, ‘Charana Pankajam...' were the other popular hits. Other songs that impressed were ‘Vela cheyyu...' (Radha-Jayalakshmi) and ‘Nirasha mathram aayi...' (Periyanayaki).