My daughter Keira Knightley

You could hardly think of a more idyllic spot for a writer to begin work on a new project: St Vincent, sometime during the shooting of The Pirates of the Caribbean. Playwright and screenwriter Sharman Macdonald was on location, chaperoning her 17-year-old actress daughter, Keira Knightley, one of the stars of the movie, but working on her own project in the breaks between watching Jack Sparrow and Elizabeth Swann in action.

"I was very busy writing but I did have a long, long daiquiri at my elbow," she recalls of how she began her script for The Edge of Love. "I loved the sunshine. We went by boat to set every morning. I loved the boat."

The situation was certainly very different from the one Macdonald was in two decades before, when she wrote her first play, When I Was a Girl, I Used to Scream and Shout. Back then in the early 1980s, she was a former actress (stage fright had made her abandon the career) who yearned both to be a successful writer and to have another child. (Her son Caleb was then a toddler.)

"We were broke," she remembers. "We were living rather healthfully on lentils, bread and tomatoes. It was just one of those bad patches." Her husband (actor Will Knightley) bet her "the sale of a script against the birth of a second child". Macdonald's play ended up being bought and performed at the Bush Theatre. She was therefore able to have the second child. Put to her that without the success of When I Was a Girl..., Keira might never have been born and British cinema might have been deprived of one of its current idols, she replies: "I am sure I would have found another way. I never give up."

Now her daughter is among Britain's best-known movie stars. What has it been like for her to witness Keira's rise and rise? "I feel huge pride, absolutely – a certain amount of concern when pressures are too much, but only in as far as any mother has concern for a child doing anything as they grow up and fly on their own in any sphere. You hope the wings don't break and that if they do break, you can be there to catch (her) and to make it better. It's the same for any parent, it really is. When my son (who works in drama for BBC Radio) went into the various things he went into, the concern was there too."

Macdonald had been a young actress herself but her experience was very different from that of her daughter. After leaving Edinburgh University, where she had studied English literature, she had led the traditional stage actor's life, living in digs, performing around the country. She appeared in political plays such as John McGrath's Fish in the Sea about a strike in Liverpool.

"I loved touring. I loved the feeling that you could change the world. I so believed that – that a play could change the world," she says of her 20s. "I absolutely adored it. Coffee in the morning, cigarettes! I loved having cigarettes, getting up late in the morning when you were touring and talking, talking, talking. I think I loved that more than being on stage. And, yes, I miss that – those extraordinary friendships."

Her daughter's rise has been so sudden and she has been so much in the media glare that she has never had the chance to sample such a lifestyle. "It's different but she doesn't know anything else, but she has an amazing group of friends who talk, talk talk. Youth will talk and youth will try to change the world. I don't think anything of that changes in different generations."

Macdonald introduced her kids to theatre and ballet at an early age. She recalls talking her son to a production of Romeo and Juliet at the Royal Opera House when he was only three. They were sitting at the top of the theatre in sweltering heat and the rest of the family was desperate to leave but he refused. She also introduced Keira to ballet when she was very young and gradually eased her into the world of musical theatre. "Les Misérables, The Phantom of the Opera – they were wonderful for kids." Shakespeare proved less successful.

Both the children were dyslexic. "I didn't see it with either of my children which is rather shocking and I feel enormous guilt about that," Macdonald says. "I didn't spot it in my son. It was the school who spotted it. And it was Keira's grandmother who spotted hers. You would think that having had one dyslexic child, I might possibly spot it in a second but I didn't."

Keira was six at the time the dyslexia was noticed and had already expressed a desire to perform. "She acted reading," Macdonald adds." She had a very good memory. What she was doing was reading back what had been read to her but she was capturing it perfectly. What she wasn't identifying was words. It fooled the school as well."

Keira loved stories and would listen to dozens of book tapes. Her precocious ability to act gave her the confidence to cope with her dyslexia. Macdonald's son, meanwhile, derived pride from his skill at water skiing. "That helped him overcome his disability with reading, with words."

As her children grew older, Macdonald had to cope with the same problems as any other parents fretting about the big bad world beyond the home. "Any parent has to take a step back from their children. You have to let go. Sometimes letting go can be very, very difficult because you miss the companionship. The empty nest syndrome isn't suffered by the parents of children whose kids have become stars alone."

Her screenplay for The Edge of Love had a lengthy gestation. Originally, Macdonald had thought that Keira might play Caitlin Thomas, Dylan Thomas's wife. In the event, her daughter was more drawn to the role of Thomas's childhood sweetheart, Vera. This was a project with a strongly personal resonance for its screenwriter.

"My father is Welsh and so I am a Welsh Macdonald. We used to say that his family started running from Glencoe and never stopped," the writer explains her fascination with Dylan Thomas, whose turbulent love life the film explores. Her father despised Dylan Thomas, dismissing him as "as professional Welshman" who traded on his Welshness and lost his accent – two unpardonable sins.

Then, when Macdonald was at university, she performed in Thomas's Under Milk Wood. This was an epiphany: she was won over by the musicality of his writing. "I just fell in love with all of it," she says. "I never ever ever felt critical of his life or his womanising or his drinking. I felt that had I ever met him, his talk would have seduced me as Under Milk Wood had seduced me."

'The Edge of Love' is available on DVD