To the gossips, she's the wife of the film whizzkid Stephen Woolley. But her formidable list of screen credits and her young family show Elizabeth Karlsen to be something else. By Ruth Picardie Standy stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand stand
Hugh and Liz. Natasha and Liam. Ken and Em. Em and Greg. Ken and Helena: sometimes the British film industry feels like one big parade of glittering couples. There are beautiful people behind the cameras too, and the ones leading the way are Woolley and Karlsen - Steve and Liz to their friends.

You may well have heard of Stephen Woolley: the Islington council estate kid turned ponytailed producer (with his partner at Palace Pictures, Nik Powell) of some of the most memorable and furiously hyped (not to mention a few of the most forgettable) films of the Eighties, including The Company of Wolves, A Letter To Brezhnev, Mona Lisa, Scandal and The Crying Game. Only last week he popped up at the Venice film festival to promote his controversial bio-pic, Michael Collins. And Elizabeth Karlsen, 36, his wife of the past five years? There's a fair amount of unkind gossip about her. "Basically," says one insider, "she's Steve Woolley's wife." "Her new film has been kicking around for months," says another. "Very insecure." "Daddy lives in a mansion in Switzerland."

Envy is understandable when it comes to Elizabeth Karlsen. To begin with, she and Woolley, 40, recently exchanged their house in West London (flight path, cat piss in the garden) for a large, beautiful, Georgian, Grade II-listed, wisteria-entwined home near Bath, a stone's throw from Dyrham Park, the National Trust mansion where The Remains of the Day was filmed. Outside, there are three acres of overgrown land, including an orchard and a brook; inside, all is empty, minimalist chic: unvarnished floors, flagstone halls, freshly plastered walls.

Then there's her track record: co-producer of The Crying Game (six Oscar nominations; one of the most successful British films ever); producer (with Olivia Stewart) of Terence Davies's The Neon Bible (in competition at the Cannes film festival, 1995). Karlsen's new film, Hollow Reed, her first solo project, was written by Paula Milne (hot from The Politician's Wife), optioned by Dustin Hoffman and is now being touted as a "gay Kramer vs Kramer for the Nineties".

Karlsen has somehow managed to combine this with having children: four- year-old Edith and two-year-old Agnes, tiny, wild-haired versions of their father, whose small screams echo through the house. Oh, and she's also a babe: American-born with a British mother, a Norwegian father and a weird mid-Atlantic accent, she is gamine, exotic (dark eyes, dark hair and dark tan from a holiday in France) and chic, today in faded jeans (despite being four months pregnant), eggshell blue linen shirt and brown Birkenstock sandals. And she's got an MA in the seriously scary field of critical theory.

Most infuriating of all for the gossips, Karlsen is as nice, chaotic and neurotically self-deprecating as the best non-superwoman. She worries about the fact that, on holiday, she only made two work-related calls. (Woolley took his mobile phone to the beach.) The day she took Gena Rowlands to a flash LA restaurant to love-bomb her into making Hollow Reed, Karlsen's credit card was refused. (Rowlands's agent had to pay; the actress committed anyway.) She feels guilty about sending Edith to private school. And she's anxious about the reception of the film. "It's not a Trainspotting audience. That fills me with terror because it's difficult to get people to go to the cinema ... I mean, I never go any more."

Evidently, having it all isn't as easy as it seems. "Since Neon Bible," explains Karlsen over tea and designer biscuits, while the children are supervised by a cool Australian nanny, "we've been apart a lot, a lot, a lot. Steve was in New Orleans doing Interview With A Vampire. The second baby was born just before he came back and then I went off to American for Neon Bible. I was there for four-and-a-half months. He came out a couple of times, I suppose. Then he went off to Ireland [to make Michael Collins] for about seven months and I was filming Hollow Reed." (Luckily, mother, mother-in-law and nanny stepped into the breach. "I felt like some strange executive producer," says Karlsen. "I was always at work and I'd installed this harem of women.")

In 1993, she gave birth to Agnes alone, while Woolley was - literally - halfway across the Atlantic. "When he arrived the next morning," says Karlsen, "the first thing I said was, `It's a girl', and he said, `Yeah, I know'. He had got the pilot to call Heathrow and Heathrow to call the hospital."

It's not just the separations: in 1992, she was dispatched (as the only French-speaker on the film) to Paris with a six-week-old baby and a print of The Crying Game to lobby the director of the Cannes film festival, Giles Jacob. The film was left behind in Heathrow by the airline; when it finally turned up, Karlsen had to rush direct to the screening rooms and then pace the streets with her screaming baby, who wasn't breastfeeding properly. Jacob turned the film down. Later that year, Palace Pictures - which Karlsen joined in 1988, initially as Woolley's assistant - went bankrupt; bailiffs took everything except the family house, which was in Karlsen's name.

However, she seems to have been a golden girl from early on, always in the right place at the right time. "Growing up in the Sixties was great," says Karlsen, who was born in New York City. One of her earliest memories was being taken en famille to file past President Kennedy's coffin (although at the end of the decade, her older brothers refused to take her to Woodstock).

Moving to Britain at the age of 12 (her father changed jobs), she was regarded as a sophisticated exotic. "In America all the kids went to summer camp and had hamburgers and steak. We had fishballs, our clothes were sent from Marks & Spencer and we went to see our grandparents for the holidays. So we were alien creatures there and alien creatures when we came here." One fellow pupil at her Home Counties boarding school actually asked "Are you a negro?"

In her teens, she combined brainy science A-levels with a non-brainy sideline as a kids' TV presenter, including the Saturday Banana Show, which was looking for a hip skateboarding chick. Highlights included meeting Elton John and Debbie Harry. "I was desperate for her to think, `Oh you're cool, too,'" says Karlsen. "All she could say was, `Oh man what am I doing on this terrible kids' TV show?'"

Karlsen then spent a year in Paris, hanging out with photographers and painters and filmmakers: "I thought I was Jean Seberg." Back in London, working as a cinema usher at the ICA and studying for a degree in science, she met more wannabe artists, including Hanif Kureishi and David Leveaux, and started worrying about her career as a genetic engineer. "I thought, this is crazy. All I know about is thermo-regulation of the lizard and the double-helix structure of DNA. I don't want to be a scientist."

She ended up studying English at Sussex, going on to do an MA. "Semiotics, representation, Foucault, Derrida, Lacan, etc," says Karlsen, in non-Saturday Banana Show mode.

After moving to New York, she got a job as a proofreader with - as it turned out - America's hippest young filmmakers of the future, including Christine Vachon and Todd Haynes, whose bleakly apocalyptic Safe came out earlier this year. Karlsen went out with Vachon's brother and worked on Bill Sherwood's gay elegy, Parting Glances.

Heading back to London in 1988, she got a job at Palace, one of long line of talented assistants to Steve Woolley who then moved on to greater things: Joanne Sellar (who also dated the boss) is currently in Los Angeles making Boogie Nights with Burt Reynolds; Amanda Posey (who didn't) has just produced the film adaptation of Fever Pitch, starring Colin Firth.

Karlsen married Woolley, which is - confounding the gossips - where her problems began. "At times you long for you both to come home at 7pm," sighs Karlsen, "eat dinner with the kids at 7.30pm, put them to bed and talk." Prosaic? Spoken like one half of a truly glittering couple.

`Hollow Reed' opens today