Beginning in the late 1960s, Essaouira became something of a hippie hangout. Despite common misconception, Jimi Hendrix's song "Castles Made of Sand" was written in 1967, two years before he visited the castles of Essaouira. Cat Stevens also spent some time in Essaouira.

In the early 1950s film director and actor Orson Welles stayed at the Hotel des Iles just south of the town walls during the filming of his 1952 classic version of "Othello" which contains several memorable scenes shot in the labyrinthine streets and alleyways of the medina. Legend has it that during Welles's sojourn in the town he met Winston Churchill, another guest at the Hotel des Iles. Orson Welles's bust is located in a small square just outside the medina walls close to the sea. It is in a neglected state being covered in bird droppings, graffiti and with a broken nose. In addition, the dedication plaque below it has been stolen (as of Dec 2008). Several other film directors have utilised Essaouira's photogenic and atmospheric qualities.