Bret McKenzie has won an Oscar for his original song Man or Muppet in The Muppets film.
The sweet comic duet was sung by Jason Segel and his Muppet brother in the film, the first big-screen adventure in 12 years for Kermit the frog and company.
McKenzie, one half of comedy duo Flight of the Conchords, was musical supervisor on The Muppets, a role that involved overseeing the songs on the film and writing three himself.
Earlier Muppet flicks had been nominated for four music Oscars but lost each time, including the song prize for The Rainbow Connection, Kermit's signature tune from 1979's The Muppet Movie.
''I grew up in New Zealand watching the Muppets on TV. I never dreamed I'd get to work with them,'' said Wellingtonian McKenzie,'' and joked about meeting Kermit for the first time.
''Like many stars here tonight, he's a lot shorter in real life.''
He thanked his two children and wife Hannah Clarke, who was at the awards and wearing Kiwi label Zambesi.
His parents were also mentioned for "never telling me to get a real job".
The other New Zealand Oscar hope had to leave the 84th Academy Awards disappointed: Weta Digital's 's visual effects team of Daniel Barrett, R Christopher White, Joe Letteri and Dan Lemmon were outdone in the Visual Effects category by Martin Scorsese's Hugo.
FIVE OSCARS FOR THE ARTIST
But the big winner of the night was The Artist, winning five Academy Awards including best picture, becoming the first silent film to triumph at Hollywood's highest honours since the original Oscar ceremony 83 years ago.
Among other prizes for the black-and-white comic melodrama were best actor for Jean Dujardin and director for Michel Hazanavicius.
The other top Oscars went to Meryl Streep as best actress for The Iron Lady, Octavia Spencer as supporting actress for The Help and Christopher Plummer as supporting actor for Beginners.
The Artist is the first silent winner since the World War I saga Wings was named outstanding picture at the first Oscars in 1929 had a silent film earned the top prize.
''I am the happiest director in the world,'' Havanavicius said, thanking the cast, crew and canine co-star Uggie. ''I also want to thank the financier, the crazy person who put money in the movie.''
The win was Streep's first Oscar in 29 years, since she won best actress for Sophie's Choice. She had lost 13 times in a row since then. Streep also has a supporting-actress Oscar for 1979's Kramer vs. Kramer.
''When they called my name, I had this feeling I could hear half of America go, 'Oh, no, why her again?' But whatever,'' Streep said, laughing.
''I really understand I'll never be up here again. I really want to thank all my colleagues, my friends. I look out here and I see my life before my eyes, my old friends, my new friends. Really, this is such a great honour but the thought that counts the most with me is the friendship and the love and the sheer job we've shared making moves together.''
Streep is only the fifth performer to receive three Oscars. Jack Nicholson, Ingrid Bergman and Walter Brennan all earned three, while Katharine Hepburn won four.
The 82-year-old Plummer became the oldest acting winner ever for his role as an elderly widower who comes out as gay in Beginners.
''You're only two years older than me, darling,'' Plummer said, addressing his Oscar statue in this 84th year of the awards.
''Where have you been all my life? I have a confession to make. When I first emerged from my mother's womb, I was already rehearsing my Oscar speech.''
The previous oldest winner was best-actress recipient Jessica Tandy for Driving Miss Daisy, at age 80.
Completing an awards-season blitz that took her from Hollywood bit player to star, Spencer won for her role in The Help as a headstrong black maid whose willful ways continually land her in trouble with white employers in 1960s Mississippi.
Spencer wept throughout her breathless speech, in which she apologised between laughing and crying for running a bit long on her time limit.
''Thank you, academy, for putting me with the hottest guy in the room,'' Spencer said, referring to last year's supporting-actor winner Christian Bale, who presented her Oscar.
Dujardin became the first Frenchman to win an acting Oscar. French actresses have won before, including Marion Cotillard and Juliette Binoche.
''Oh, thank you. Oui. I love your country!'' said Dujardin, who plays George Valentin, a silent-film superstar fallen on hard times as the sound era takes over. If George Valentin could speak, Dujardin said, ''he'd say ... 'Merci beaucoup, formidable!'''
Claiming Hollywood's top-filmmaking honour completes Hazanavicius' sudden rise from popular movie-maker back home in France to internationally celebrated director.
Hazanavicius had come in as the favourite after winning at the Directors Guild of America Awards, whose recipient almost always goes on to claim the Oscar.
The win is even more impressive given the type of film Hazanavicius made, a black-and-white silent movie that was a throwback to the early decades of cinema. Other than Charles Chaplin, who continued to make silent films into the 1930s, and Mel Brooks, who scored a hit with the 1976 comedy Silent Movie, few people have tried it since talking pictures took over in the late 1920s.
The only other filmmaker from France to win the directing Oscar is The Pianist creator Roman Polanski, who was born in France, moved to Poland as a child and has lived in France since fleeing Hollywood in the 1970s on charges he had sex with a 13-year-old girl.
Hazanavicius, known in his home country for the OSS 117 spy comedies but virtually unheard of in Hollywood previously, won a prize that eluded half a dozen of France's most-esteemed filmmakers, including Jean Renoir, Francois Truffaut and Louis Malle, who all were nominated for directing Oscars but never won.
Martin Scorsese's Paris adventure Hugo won five Oscars, including the first two prizes of the night, for cinematography and art direction. It also won for visual effects, sound mixing and sound editing.
The visual-effects prize had been the last chance for the Harry Potter franchise to win an Oscar. The finale, Harry Potter and the Deathly Hallows: Part 2, had been nominated for visual effects and two other Oscars but lost all three. Previous Harry Potter installments had lost on all nine of their nominations.
The teen wizard may never have struck Oscar gold, but he has a consolation prize: US$7.7 billion (NZ$9.2 billion) at the box office worldwide, including US$1.3 billion from Deathly Hallows: Part 2, last year's top-grossing movie.
''And yet they only paid 14 percent income tax,'' Oscar host Billy Crystal joked about the Potter franchise.
Filmmaker Alexander Payne picked up his second writing Oscar, sharing the adapted-screenplay prize for the Hawaiian family drama The Descendants with co-writers Nat Faxon and Jim Rash. Payne, who also directed The Descendants, previously won the same award for Sideways.
Payne said he brought along his mother from Omaha to the Oscars, and that she had demanded a shout-out if he made it onstage.
''She made me promise that if I ever won another Oscar I had to dedicate it to her just like Javier Bardem did with his Oscar. So mom, this one's for you. Thank you for letting me skip nursery school so we could go to the movies.''
WOODY ALLEN CLAIMS FIRST ACADEMY AWARD IN 25 YEARS
Woody Allen earned his first Oscar in 25 years, winning for original screenplay for the romantic fantasy Midnight in Paris, his biggest hit in decades. It's the fourth Oscar for Allen, who won for directing and screenplay on his 1977 best-picture winner Annie Hall and for screenplay on 1986's Hannah and Her Sisters
Allen also is the record-holder for writing nominations with 15, and his three writing Oscars ties the record shared by Charles Brackett, Paddy Chayefsky, Francis Ford Coppola and Billy Wilder.
No fan of awards shows, Allen predictably skipped the ceremony, where he also was up for best director and Midnight in Paris was competing for best picture.
Best-picture front-runner The Artist, which ran second to Hugo with 10 nominations, won two Oscars, for musical score and costume design.
Rango, with Johnny Depp providing the voice of a desert lizard that becomes a hero to a parched Western town, won for best animated feature.
''Someone asked me if this film was for kids, and I don't know. But it was certainly created by a bunch of grown-ups acting like children,'' said Rango director Gore Verbinski, who made the first three of Depp's Pirates of the Caribbean movies.
Undefeated, a portrait of an underdog high school football team, won for feature documentary.
Crystal got the show off to a lively start with a star-laden montage in which he hangs out with Justin Bieber and gets a nice wet kiss from George Clooney.
Back as Oscar host for the first time in eight years, Crystal also did his signature introduction of the best-picture nominees with a goofy song medley.
Before his monologue, Crystal appeared in a collection of clips inserting him in scenes from key nominees. The montage included re-creations from some 2011 films featuring Tom Cruise of Mission: Impossible - Ghost Protocol and Clooney's best-picture contender The Descendants, with the actor planting a kiss on Crystal.
Spoofing a scene from nominee Midnight in Paris, Bieber told Crystal he was there to bring in the 18-to-24-year-old demographic for the 63-year-old host.
Crystal's return as host seemed appropriate on a night that had Hollywood looking back fondly on more than a century of cinema history.
The top two nominees Hugo and The Artist - are both love songs to early cinema.
Add the Marilyn Monroe tale My Week with Marilyn - which earned Michelle Williams a best-actress nomination as the Hollywood's greatest sex goddess and Kenneth Branagh a supporting-actor nomination as Oscar winner Laurence Olivier - and the show's producers had a ready-made script for a night of fond recollection and backslapping about show business.