A teenage girl dangles from a tightrope, strung between two office buildings in the Sydney CBD. She wears a soft helmet and at first glance her chest is exposed – exaggerated fake breasts poking out from under a gaudy set of DIY wings. It’s pop art, by way of the Sydney Mardi Gras parade.

The girl is Jackie Mullens, a singer with “that little something extra”, wearing a costume guaranteed to attract the attention needed to crack the big time.

The Sydney Harbour bridge gleams in the background as uniformed policeman unfurl a bullseye parachute below. She’s got to drop – but will she make it?

Played by then unknown Jo Kennedy in her debut role, Jackie Mullens is the lead character in Gillian Armstrong’s 1982 rock musical extravaganza Starstruck – the film maker’s second feature after My Brilliant Career. Released in local cinemas around the same time as Puberty Blues, Mad Max and the still too-little-seen Monkey Grip, Starstruck made a splash at the box office – but has been all too hard to get a hold of in the post-VHS years.

Now, thanks to the National Film & Sound Archive’s NFSA Restores program, Armstrong’s film has been given a second life. Dedicated to digitising, restoring and preserving classic Australian titles, it’s this program – and sometimes, like in the high-profile case of Proof, crowdfunding – that has brought back films such as The Year My Voice Broke, Bliss, Storm Boy and that seminal outback skin-crawler, Wake in Fright.

The new digital print premiered at the Adelaide film festival, closed this year’s Queensland film festival, and is a jewel in the upcoming, hugely impressive Pioneering Women film thread at the Melbourne International film festival, co-curated by MIFF artistic director Michelle Carey and Alexandra Heller-Nicholas.

I had vague recollections of seeing it as a teenager, but the first time I really paid attention to it was when it unexpectedly popped up on basic cable television in America in the mid-2000s. The opening sequences – featuring a lifesize kangaroo costume and the Bondi Pavillion transformed into neon-flooded nightclub called The Lizard Lounge – flooded into my friend’s Brooklyn living room, disrupting a drab winter’s day. It was colourful, it was wild, and for the first time in months I felt homesick.

A classic wannabe rags-to-riches tale, Starstruck follows a family in time of crisis. Our heroine Jackie hopes her “animal presence” will be noticed by someone who can help make her wide-eyed dreams a reality, and she’s helped along by her younger cousin Angus (Ross O’Donovan): a shrewd, fast-talking talent agent in the making, who’ll stop at nothing to further their careers (the nude tightrope stunt was his idea).

In the meantime, their home – a pub situated under one of the southern pylons of the Harbour bridge, of course – is under threat. A lifetime of down-at-heel charm, eccentric patronage and cheap schooners may all crumble (in the way that so many of my favourite Sydney pubs actually have) in the face of a greedy brewery looking to take over, should they not make enough money to save it. Lucky then, that there’s a cash prize for a talent night held at the Sydney Opera House coming up …

Originally set in the 1960s’ mod scene, screenwriter Stephen Maclean’s tale of fame and fragility – coupled with kitsch production design by Brian Thomson – perfectly encapsulates the irreverence of the early 80s pop scene of Australia, suffused with new-wave aesthetics and a stick-it-to-the-man punk mentality. Perhaps best known for his work on both the film and original Sydney and London stage productions of the Rocky Horror Picture Show, Thomson’s sets are eye-wateringly over-the-top, matched only by the lurid costuming of Terry Ryan and Luciana Arrighi.

These combined design forces form a memorable base for the musical sequences, with their film clip direction, manic choreography, and memorable foot stomper songs by Split Enz’s Tim Finn.

One musical interlude – the stupidly catchy I Want To Live In A House – is said to have been produced by Molly Meldrum, who also inspired Starstruck’s TV presenter character Terry Lambert (John O’May).

Terry also gets one of the most memorable scenes in the film – a camp rooftop pool moment with Esther Williams-style synchronised swimmers (all male lifesavers, played by actual lifesavers from the University of Sydney), which clearly spells out that Terry’s not interested in Jackie’s schoolgirlish advances. And we haven’t even talked about Geoffrey Rush’s blink-and-you’ll-miss-it appearance as the floor manager of a Countdown-style TV show – his first screen credit.

Starstruck is one of those rare titles that people love or – and I may be biased – they simply haven’t seen. It has all the makings of one of the most iconic Australian films ever made, and yet it’s not even available here on DVD (a print was made in 2005, but has been out of circulation for years). When I got the lucky gig of programming a new cinema in Surry Hills, it was the first film I attempted to screen, but without access to a 35mm projector, it was relegated to my theatrical wishlist (we played Dogs in Space instead).

The film is a neon lightning bolt wrapped up in a gaudy tourist tea-towel and decoupaged with love letters to a skewiff memory of Hollywood. Now that it’s been reborn, I can only hope that the character of Jackie Mullens will go the way of that other archetypal Australian Muriel Heslop, and her story will be transformed into an all-singin’, all-dancing’ stage show. It’s what Angus would have wanted.

• Starstruck is screening as part of the Pioneering Women program at Melbourne International Film Festival, held from 3-21 August. Kate Jinx will be in discussion with Gillian Armstrong after the screening on 11 August