Let them eat manga: How Takashi Murakami introduced Japanese kitsch to the Palace of Versailles

Each time Jean-Jacques Aillagon, director of the Château de Versailles, tries to explain to me why he invited the Japanese contemporary artist Takashi Murakami to exhibit in the palace's sumptuous salons – a decision that has led to loud public derision and protest here in France – the huge television screen that's hanging incongruously on the 17th-century gilded wall behind us lets out an ear-splitting blast of kiddies' electronic music.

Aillagon: "It seemed appropriate for us to invite a Japanese artist, certainly one of Murakami's calibre, to Versailles, because –"

Tring-a-ling-a-tring-tring...

Aillagon: "Murakami's œuvre is without question one of contemporary art's most complete and coherent because –"

Ting-ta-ting-ta-ting-ting-ding-ping...

The offensive sound turns out to be the backing track to an artwork in the Murakami Versailles exhibition. A

new animated short film entitled Six1Princess, it carries all the signature ingredients of Murakami's sickly-sweet œuvre: whimsical Japanese characters decorated in a cutesy technicolour palette, dancing around to a nausea-inducing soundtrack. The Japanese have a word for this strand of their popular culture – kawaii, which literally means cuteness or lovability, and lends itself to everything from toys, cartoons and pencil cases to clothing, personal appearance and behavioural patterns. Japanese kawaii can also be dark, though, and having grown up in the aftermath of the Second World War and the American occupation of Japan, it's hardly surprising to discover that for every saccharine smile that Murakami paints, there's an ominous looking evil eye or fang which adds a subtle sense of horror.

By transforming kawaii culture into his own self-styled art movement, which he calls 'Superflat', over the past decade Murakami reached the highest echelons of contemporary art. Having exhibited in prestigious Western galleries and museums, his paintings and sculptural works have commandeered telephone-digit prices and landed him with an appearance in Time magazine's 100 Most Influential People list for 2008 (he's the only visual artist in the list).

Tellingly, almost every art critic who's written about Murakami refers to him as "The Japanese Andy Warhol". The comparison goes some way to explaining the phenomenal success he's had in blurring traditional lines between art, commerce, pop and subculture, but Murakami seems to have taken Warhol's mantra of "business-as-art" to absurd extremes. With ironic detachment, Warhol's work – paintings few could afford, films few could understand – appealed to an audience who were in on the joke. Murakami, on the other hand, takes from the low and gives to the high, the low, and everything in between. He makes paintings, sculptures, videos, T-shirts, handbags, key chains, mousepads, dolls and BlackBerry cases. Murakami's work hits all price points: his plastic figurines are packaged with bubble gum – a Murakami original for a couple of quid.

As well as producing the consumer merchandise (both for his own Kaikai Kiki label and for fashion houses such as Louis Vuitton and Comme des Garçons), Murakami finds the time to run a gallery and art fair called GEISAI that promote young Japanese artists, host a weekly radio talk show in Tokyo, art direct fashion shoots with Britney Spears, design bling jewellery with Kanye West... The list is endless. His 120 staff and global operation (with studios in the suburbs of Tokyo and Long Island, New York, and a £19 million annual turnover) is very much the blueprint for the 21st-century, high-concept artist, alongside his fellow art-market winners Jeff Koons and Damien Hirst. Where French Dadaist Marcel Duchamp once placed a urinal in a gallery and called it art, Murakami recently installed a fully-functioning Louis Vuitton shop in the middle of a major solo exhibition at Los Angeles' Museum of Contemporary Art.

Paradoxically, in a commission that offers no direct commercial gain, Murakami's installation at Versailles could become the pinnacle of his career. It isthe extravagant setting in which his psychedelic creations make most sense; where a plastic mushroom with a multi-million price tag seems, well, at home. For all the storm-in-a-teacup nonsense that pre-dated the opening (several thousand outraged French traditionalists petitioned and protested for the removal of Murakami's works, claiming they "shatter the harmony" of the Sun King's Royal Palace) the show is far from the eyesore detractors would have us believe. For every handful of (mainly adolescent) tourists snapping the sculptures on their iPhones, 10 times as many are too busy taking in the opulent surroundings to be overly concerned with them.

In the flesh, the 48-year-old artist is an extremely kawaii sort of chap. His round face and belly provide him with a cheery, cartoonish physique and his oversize John Lennon specs make his eyes bulge like a doe-eyed manga character. Perched on a velvet banquette alongside his interpreter, Murakami reflects on the surroundings in which he finds himself.

"It's very surreal to be here," he says, waving a hand at the gilt-laden salon. "As a kid growing up in Japan I learnt about Versailles through the girls' comic book Rose of Versailles, which was such a big hit that it became a musical and a TV show. Everyone in Japan wants to talk to me about this particular commission, not because they're interested in me or my work or even art – they're just mad about Rose of Versailles. But, you know, I don't have a problem with that."

Murakami began his art career as a traditionalist. Born in Tokyo to a taxi-driver father and a housewife mother, young Murakami was taken to exhibitions of Japanese and Western art by his mother. Afterwards, his parents expected him to write a critique of the exhibitions; failure to do so sometimes meant no supper. During his twenties at Tokyo National University, he worked on a doctorate in Nihonga, an amalgam of Western and Eastern painting styles dating to the late 19th century. But after witnessing the rise of animé and manga in Japanese culture during the 1980s, he grew disillusioned with Nihonga, finding it irrelevant to daily Japanese life. He wanted to create something that would leave a lasting impression, so he opted for contemporary art.

"I set out to investigate the secret of market survivability – the universality of characters such as Mickey Mouse, Sonic the Hedgehog, Miffy and Hello Kitty," explains Murakami. The result, in 1993, was the birth of his cartoon alter ego, Mr DoB, Murakami's most ubiquitous and enduring character. As the complexities of Murakami's examination of his own identity evolved, so did DoB, in painting and inflatable form, morphing from a strand of DNA to a balloon-like form with innocent eyes to a monster with jagged fangs.

Marc Jacobs, the creative director for Louis Vuitton who instigated the hugely successful Murakami/Vuitton branded handbags, says, "When Takashi first came into the Vuitton office in Paris he told me: 'Warhol used popular icons that everyone knew, but I want to create the icon myself. By creating a character and painting it and repeating it and repeating it and repeating it, it will end up becoming iconic'."

With DoB established as the central character, Murakami set about creating a highly stylised world, bursting with smiley flowers, drooping mushrooms and multi-coloured suns, in which he would exist. As time went on, so DoB started sharing his universe with more human-like characters; figures fashioned from garish-coloured resin who openly displayed their sexual intent: Hiropon (1997) depicts a life-size girl with electro-blue hair and eyes as wide as her maker's. Skipping cheerfully over a rope formed from the milk squirting out of her gigantic breasts, the sculpture was Murakami's unhinged take on Japan's highly-sexed pop culture and ero-manga (erotic comics) in particular. Hiropon's masturbating boy counterpart, My Lonesome Cowboy (1998), forms a lasso out of a shot of sperm, and provided Murakami with some useful outraged publicity.

back in 2002,I travelled with Jacobs to visit Murakami in his campus of buildings known as the Hiropon Factory, outside Tokyo. Ostensibly I was there to write about a handbag collection later championed by socialites and WAGs the world over. I was struck by two things: firstly, the huge number of assistants, and secondly, the look on Murakami's face when he recieved a call from his New York dealer informing him that Hiropon had fetched half a million dollars at auction. He was visibly taken aback. Within five years, though, My Lonesome Cowboy sold for for £9.5 million, making it one of the most talked-about works of the contemporary art boom.

Alongside Koons and Hirst, Murakami is probably the artist most clearly associated with the Noughties. All the elements are there to see: the post-Dadaist and Pop Art concepts, the Factory-esque work force, the phenomenal market value and subsequent recession-era collapse (at present, Murakami's more costly works are reportedly selling for around £65,000). And as with Koons and Hirst, no discussion of his work is complete without mentioning its market value; it's as if the predominant art movement of the new millennium has been the market itself. How does it feel, then, to be an artist whose work is so inherently linked with money? Murakami interrupts his interpreter, so as to deliver the answer himself, in surprisingly good English.

"I'm constantly asked by people – especially in Japan – about why my work sells for so much," he says slowly and methodically, his eyes firmly shut. "People expect me to be able to justify why I am rich and successful. All I can say is that this is the reward for the constant battle with time and stress that I live with every day."

Murakami's battle is not so much with time as it is with timelessness. "I do not see my job as creating art for today. I have to produce work that will be able to survive and have relevance in 100 or 200 years time; like the stuff in the Louvre. That is my main motivation. That is why I get angry and upset with my staff because none of them seem to understand this need to project into the future."

What don't they understand?

"They just say, 'Hey, Takashi, this is reality, this is life, if you're only living for the future you'll never be able to live for today. You'll never have a life'."

And do you have a life?

"What? Outside of my work? No. I don't have a wife or children. All my focus is on work, and this is complete fulfilment for me. I want to keep on creating but my fear is, how long can I continue? I've survived for years, but I'm not sure I can survive the next 10 years. I get angry and depressed easily and I always have a hard time coming up with new ideas."

Murakami claims he is a reviled figure in his native Japan, that his twisting of Japanese culture for a Western art market has left him labelled a sell-out at home.

"When someone scores a goal, someone else is going to be unhappy," he says sombrely. "Here at Versailles there are a few unhappy French people, but back in Japan they are delighted that I'm being criticised. They say, 'You deserve it because you are a liar. Our culture is more profound than what you export to the US, you're just a business.' I don't care. Once I'm dead people will understand what I was about.

"Before Warhol died the Americans hated him, now he's an icon. Why did they hate him during his life? Because he took the world of the average American and became rich. It's an embarrassing story, but it's true."

He says his goal is now to make movies or television shows, and if his recent acquisition of a film production unit in Los Angeles is anything to go by, this is more than just another quick collaboration; it could be the new chapter that will help to maintain his relentless creative ouput, the status, the sales, the wealth.

Murakami today says he doesn't feel particularly rich; that after the huge production costs that go into making his works, he's left with far less than people might assume. In any case, he asserts, his career has not been about the pursuit of money.

"Whether it's Picasso's paintings or mine, people want to know the answer to the same question: what is art? If in my lifetime I can in any way help define the answer, then it'll be worth all the money I ever earn."

Murakami Versailles is at the Palace of Versailles until 12 December 2010; see chateauversailles.fr for details