A cruise show on a boardwalk snaking along the Venice Lido with the sun about to set, gentle waves rolling in, and a whisper of a breeze to make sinuous shapes flutter in movement…it couldn't have been a more poetic or, given the times, more uniquely audacious Chanel moment. "I wanted to reinvent the mystique," said Karl Lagerfeld, talking about locating the collection in one of Coco Chanel's favorite summer haunts—she visited Venice for almost ten years beginning in 1919 and met Diaghilev here. But Lagerfeld might also have been speaking about reinstating the long-lost leisurely sensation of a fashion show as an exceptional one-off experience. The 350 guests reclining on sun beds in the famous white tented cabanas certainly felt privileged to be witnessing the extreme glamour of the designer's learned-but-light invocation of an important part of Coco Chanel's biography, one that was overlaid with passing allusions to Visconti, Fellini, the Venice carnival, and the city's art treasures.

"Coco on the Lido," as Lagerfeld called it, started with a tableau of figures in tricorne hats and cloaks—cover-ups for a play on girdles and bras as bathing suits. Next came Tatjana Patitz promenading in creamy lace as the picture-hatted Edwardian mother in Death in Venice, her sailor-suited son Tadzio and his two sisters in ingenue fan-pleated dresses trailing behind. From there, the sequence took off into matelot- and gondolier-inspired stripes, interpreted in long-line fine-knit cardigans and playful beachwear with funny red and white striped wedge booties. The references kept streaming out—a halterneck dress fashioned in plissé knit to suggest Fortuny, the deep Doge red and the golden lion motif of the city flag, shimmery sequins and glass embroidery made to imitate the light of Venice glancing off water.

But for all that, not to mention the silent-movie hair and makeup that strung it together, the show avoided too slavish a narrative. There were moments of silliness as well: The Chanel sunglasses recast as Venetian masquerade lorgnettes and the flashes of eroticism in the exposed corsetry spelled fun for the novelty-seeker. But the star pieces here were pure Chanel, un-themed save for their classic elegance: a long black column with a sexily tied narrow trailing scarf, a cream sequin-edged matching jacket and dress, and the unmistakable frothy silk blouses of the rue Cambon. In spite of all his extensive erudition on the art, culture, and personalities of the Venetian past, Lagerfeld concluded, "I don't use it to make costume. I was actually more interested in the café society of the thirties and the life Chanel lived here, which is gone now." True, but as guests wend their ways home after two days of roaming the museums, churches, bars, restaurants, and nightclubs of Venice, they're returning with tales of a happening few would believe could really take place in 2009.