Nomadland by director Chloe Zhao won top prize at the Venice film festival on Saturday, the first woman to win the prize in a decade.

The film, an ode to American wanderlust and the highs and lows of the open road, won the Golden Lion in a competition billed as a relaunch of global cinema bruised by the coronavirus crisis.

Starring Frances McDormand, it is set among the new tribe of ageing van dwellers, down on their luck and roaming the West. The double-Oscar winner plays a widow who takes to the road when she loses her home.

Its Chinese-born director Chloe Zhao picked up the coveted award 10 years after Sofia Coppola’s 2010 win for her film Somewhere.

The 77th edition of the “Mostra” festival took place in a year when theatres have been closed, film sets shut down and film-goers forced to embrace streaming video at home instead, during months of coronavirus-imposed lockdown.

Zhao, 38 is one of Hollywood’s hottest new talents. Variety magazine hailed her last film, The Rider, about a rodeo grunt, as a “mini-masterpiece” and she currently is making the next Marvel movie, The Eternals.

Nomadland was loudly applauded when it premiered at Venice Friday and had horns honking at its US premiere hours later at a drive-in cinema in Pasadena, California.

The Guardian’s Peter Bradshaw said McDormand’s “quiet, self-effacing performance may be the best of her career”.

Other critics were also in raptures, the Hollywood Reporter calling it “a unique portrait of outsider existence”. Variety said “the movie is a marvel of empathy and introspection”.

Zhao, who cast real van dwellers opposite McDormand, insisted the film was not political.

Many, however, saw it as an subtle allegory on US decline, with its humble heroes clinging onto the last threads of the American dream.

Normally attended by more than 10,000 film industry executives, critics, journalists and film-goers, the Venice festival was the first major international movie competition to go ahead after others around the world, including its main rival, the Cannes Film Festival, were cancelled.

Festival director Alberto Barbera called the event “a sort of test” for the film industry, which is slowly regaining its footing, with some production resuming and cinemas reopening, even as Covid-19 cases continue to rise in many parts of the world.

In Italy, the festival was also viewed as a sign of hope and normality for the first country in Europe to be battered by the global crisis.

Nevertheless, big-budget blockbusters that have premiered in Venice in years past were missing, as was the bevy of Hollywood A-listers, who have fans screaming for autographs on the sidelines of the red carpet.

Instead, the 2020 version was decidedly low-key, with about half the usual number of attendees, fewer films and seating in theatres that was staggered to respect social distancing.

Masks were mandatory, hand sanitiser bountiful, temperatures were taken on entering the festival grounds and ubiquitous red signs warned attendees to respect the anti-coronavirus measures.

Still, organisers said the scaled-down event offered a diverse panorama of cinema today, with 50 different countries represented in the line-up.

In the main competition for the top prize, eight films were directed by women, which some hope reflects a new direction for festivals after criticism in past years over a lack of gender diversity.

Brad Pitt, Meryl Streep and Scarlett Johansson were among those who supplied the celebrity panache at last year’s festival.

But ongoing travel restrictions – especially a travel ban from the United States into Europe – meant most Hollywood big names were no-shows this year, along with actors and directors from China, India and South America.

However, Cate Blanchett, as jury president, provided some much-needed star power, telling an opening night audience that the festival’s launch seemed “some kind of wondrous miracle”.

As well as Blanchett, the judges comprised US actor Matt Dillon, Austrian director Veronika Franz, British director Joanna Hogg, Italian writer Nicola Lagioia, German director Christian Petzold and French actress Ludivine Sagnier.

Last year, Joker by US director Todd Phillips took home the Golden Lion.