Director Garth Davis says it will be a more expansive and meditative version that will be "a treat" for fans. It will be launched with a round of Q&A screenings early next month.

"Now that we know that the film has been so loved, some die-hard fans may want to go back and spend that extra eight minutes exploring different worlds," Davis says.

Lion, the drama about Saroo Brierley tracking down his birth mother in India using Google Earth, has become a striking success in Australian cinemas.

In taking $27.7 million so far, it has become the fifth biggest local film at the box office - behind only Crocodile Dundee, Australia, Babe and Happy Feet. It was also nominated for six Academy Awards including best picture and supporting actor nominations for Dev Patel and Nicole Kidman.

Davis, who is editing new film Mary Magdalene in Melbourne, says the decision to release an extended version came from the "love in the room" for Lion.

"We see it as a bit of a treat for the fans," he says. "It's a slightly different experience. It may go into a little bit more depth in areas and it has a slightly different rhythm. There's a little bit more on [Saroo's] relationship with Lucy and a little bit more on the Indian back story as well."

Describing the response to his first film as "totally insane", Davis says a producer's warning that he could expect "Beatlemania" when he returned to Australia from the Oscars has proven accurate.

He has been overwhelmed by the response of people he knows, including multiple requests from his children's school friends to interview him.

"It's just grabbing everybody," he says. "Everyone's seen it at least twice. I've done four charity screenings in the last month alone.

"It's a film that people are touched by and they want to use it as a way to segue into charity work conversations about how we can all live together in better ways."

Lion has taken $US114 million ($150 million) at the worldwide box office including $US48 million in North America.

Davis believes its success in this country is largely down to the strength of the characters and their determination to never give up.

"There's a lot of hope in the film. But it's a hope that you can trust. It's not sugar-coated. The film does traverse some tough material but through these everyday people, we witness the miracles that they create."

Lion's Rooney Mara also stars in Mary Magdalene, with Joaquin Phoenix as Jesus. Davis says the film, shot in Italy, will present "very relatable, very human" versions of the two characters.

"It's beautiful, it's immersive and captivating," he says. "I just can't wait to get into the office every day and delve into that world."