The plot for "Emilia Perez" initially sounded too crazy even for France's shape-shifting master director Jacques Audiard, who previously won the festival's top prize Palme d'Or in 2015.
But gushing reviews suggest Audiard may be a favourite to win again as the competition reaches its halfway point.
The film stars Zoe Saldana, of "Avatar" and "Guardians of the Galaxy", as a lawyer enlisted by the cartel boss who has always wanted to be a woman.
There were rave reviews for 52-year-old trans actor Karla Sofia Gascon in the title role.
Gascon transitioned at 46 having already built a family and a career in Spanish-language films and soap operas, and has written a book about her experiences with homophobia and transphobia.
Gomez plays the boss's unsuspecting wife in a surprisingly gritty turn for the mega-selling popstar-turned-actor.
Frontrunner
This year's Cannes, which concludes on May 25, has seen two American veteran directors deliver end-of-life testaments -- Francis Ford Coppola's deeply divisive "Megalopolis" and Paul Schrader's deathbed tale, "Oh, Canada".
But Audiard has delivered a film that is bursting with youthful exuberance and audacious entertainment, as catchy reggaeton, Mexican tunes and French chanson are subtly mixed into a drama that tackles gender identity, gang violence and disappearances.
Deadline called it "crazy, but also a marvel", while The Hollywood Reporter said it was "fresh, full of vitality and affecting".
The director won the Palme d'Or in 2015 for refugee story "Dheepan" and has made a series of very different and critically lauded films, including "The Prophet", "Rust and Bone" and "The Sisters Brothers".
"Emilia Perez" seems well-suited to impress this year's jury president, Greta Gerwig, known for her own musical hit, "Barbie".
The film was part-financed by Saint Laurent, the first fashion house to build a fully fledged film production company into its activities.
Saint Laurent also backed two other lauded directors who are competing at Cannes: David Cronenberg's "The Shrouds" and Paolo Sorrentino's "Parthenope" will both premiere in the coming days.
