Though these people were experienced professionals, none could claim long-standing connections to Orange County. Unable to negotiate a way out of the mess, Disney essentially stuck to the strategy of walling itself off, pursuing legal and political measures that would keep the resort district separate from Anaheim.

Disney's maneuvering initially didn't work. In April, Anaheim's city council voted 3 to 2 to permit wholly residential development on the SunCal site.

Having lost the battle on the legislative front, Disney exercised that cherished right of all Californians—to appeal directly to voters. The company and its coalition, Save Our Anaheim Resort, have gathered enough signatures to qualify for a referendum that would reverse the zoning change. Disney also launched a ballot initiative to prevent the council from making other changes near the resort.

By playing hard politics, Disney took a public relations hit. The Daily Show couldn't resist casting Mickey Mouse as the heavy. Councilmembers and housing advocates reveled in the spotlight.

"This is not, to me, about a project in the resort. This is about something that brings attention to the problem" of affordable housing, says Lorri Galloway, a member of the Anaheim council who opposes Disney on this issue. "Do you think it bothers me that the situation is negative right now? Of course not, because it won't get press attention otherwise. This whole David and Goliath thing with Disney? I love it. Call me a loser? I love it. Tell me that Disney's going to kick my ass? I love it."

Now that it has begun the battle, Disney won't give up easily. "People say Disney has never been this aggressive, and that's true. But we've never faced a situation this egregious," says Lowe, the Disney government-relations executive. "We're not like manufacturing companies, where they can go out and leave town."

The impact on Disney won't be known for some time. SunCal sued the mobile-home-park owner in October, and the developer's contract to buy the land is now in litigation. As a result, the swing vote on the five-person council indicated that she intends to reverse the council's zoning decision to allow housing on the SunCal site. That would make the referendum unnecessary and give Disney a crucial victory but wouldn't end the long-term battle. Disney still faces a ballot fight on the initiative. A vote is still six months away, though TV and radio spending has already begun. Disney's side spent more than $1.75 million on the ballot measure in the first nine months of 2007. Disney's opponents, who portray the company as a corporate bully, spent more than $600,000 in the same period.

But Disneyland's relations with its Anaheim neighbors could be forever changed. Councilwoman Lucille Kring, the swing vote on housing matters, says she sometimes imagines Anaheim without Disney. She talks longingly of the master-planned communities south of Anaheim, places like Irvine, with its upper-middle-class neighborhoods, big parks, and good schools.

"People say that if Disney were not here, we would be Garden Grove or Santa Ana," two of Anaheim's poorer neighbors, she says. "I say that if Disney were not here, perhaps we'd be Irvine. We wouldn't have all these low-skilled, low-paying jobs, and we wouldn't need the housing for those kinds of jobs. We'd have land like Irvine and could build to get the high-end jobs and the headquarters of major corporations."

Disneyland president Grier maintains that his company's initiative offers "a permanent solution to protect the resort." But there may be no permanent solutions for Disneyland in Anaheim. Other developers are planning housing developments in the resort district and criticizing Disney. The company, even with a victory in next year's election, might not be able to rebuild the wall around itself. Disney's allies in the chamber of commerce project that 100,000 new residents will settle in Anaheim in the next 15 years. And while recent trends suggest that many of these newcomers will be Latino immigrants who don't yet vote (the electorate is still mostly white and Republican), that will change over time.

To grow, Disney will need the cooperation of the new Anaheim. And some of the barriers between Walt's utopia and the real world that surrounds it will have to come down for good.

Additional reporting by David Levine.