The film takes place 8 years after Honey, I Blew Up the Kid (1992). In this film, Adam is 10 and was 2 years old in the previous film.
The film was originally scheduled for a theatrical release during the 1996 holiday season. However, because Disney was having success with animated direct to video films, the studio chose this film as the first live action direct to video movie. This would explain the copyright year being 1996 in the closing credits and why Walt Disney Pictures is listed in the opening credits, despite the fact that the movie begins and ends with the 1991-2002 Walt Disney Home Video logo.
The only film in the "Honey..." series to not have an animated opening credit sequence.
Rick Moranis is the only original actor from the previous movies to return.
The script was originally written with the intention that Marcia Strassman would return as Diane. When she refused to do so however, it was considered to have Diane being written out as having passed away and with Wayne re-marrying another woman (to be eventually played by Eve Gordon) who became his kids new stepmother. However Rick Moranis' wife in real life died in 1991, leaving him a single parent and the writers felt it would be disrespectful to have it hit too close to home by killing off Diane. As a result Diane stayed alive and many actresses auditioned to replace Strassman with Gordon ultimately being selected as the replacement.