Upon its theatrical release in 1978, Renaldo and Clara received poor reviews, and, after opening in New York City and Los Angeles, its initial limited theatrical run was discontinued after a few weeks. The film was also shown in a film theatre in Hampstead, London, in a film theatre in Rialto, Dublin and in the Tyneside Cinema in Newcastle-upon-Tyne in May 1979.
Janet Maslin of The New York Times wrote in her review of the 1978 debut of Renaldo and Clara, "The film is full of connections to be made and riddles to be solved, but it approaches these things so dispassionately that the viewer has little choice but to follow suit. Even though Mr. Dylan makes it clear that he in no way wanted to make a concert film, the footage of him in performance provides not only the film's most electrifying moments but also its most emblematic ones"
Later in 1978, Dylan allowed a two-hour edit of the film to be distributed. The shortened version focused more on the concert footage and omitted many of the dramatic scenes.
After a small number of showings of the original version on European television, Dylan withdrew the film from distribution. It was shown in two parts 7–8 July 1980 on German television ZDF; on Finnish television 28 August 1982; 26 December 1983 (Boxing Day) on Channel 4 in the United Kingdom. The 4-hour version was also shown 29 May 2011 at the Glasgow Film Theatre.