It's by the same director who did My Neighbor Totoro, and I think you get the same delight watching these two movies. Plus Ponyo has a little of The Little Mermaid mixed in.
If you haven't seen this movie.... then I'm sad for you. It's such an ode to the imagination of children. And it's totally funny!
Here's a trailer. That theme song is amazing.
and I'm so glad I found another movie that's like it!
Personally though I think the voice clips they take for the trailer is a bit misleading for the story...
Go watch it!