Citing Cruz's agent, El Pais said the film was still without a title but that the sought-after actress would speak in Spanish and in English.
Allen has shot two of his last features in London -- "Match Point" and "Scoop" -- and announced some time ago that he would film in Barcelona, without giving further details.
His latest film, "Cassandra's Dream," starring Ewan McGregor and Colin Farrell, has yet to be released.
Cruz, from Madrid, is currently nominated for an Oscar for best actress for her leading role in Spanish director Pedro Almodovar's "Volver," for which she has won Spain's top cinema prize, a Goya.