The birth of the puppies actually happened to the author Dodie Smith. Her dalmatians had 15 puppies, one was born lifeless and her husband revived it. However, they sold most of them, and kept only a small number.
Disney was in debt following the flop of Sleeping Beauty (1959) and desperately needed a hit. There was even talk of closing down the animation division as the company was refocusing on live action films, television and theme parks.
Xerox was a crucial help in the animation of hundreds of spotted dogs. Disney was able to bring the movie in for about half the cost thanks to this process.
When Walt Disney read Dodie Smith's story in 1956, he immediately snapped up the film rights. Smith had always secretly hoped that Disney would do just that.