According to Deadline, the studio has acquired the rights for the production and hired Eric Idle, who wrote the music and lyrics for the original musical, to pen the screenplay.
Casey Nicholaw, who choreographed the musical, will helm the project.
The film will be produced by Dan Jinks and Idle. Jon Gonda, Meg Lewis and Mike Ireland will oversee the project for Paramount.
"Spamalot", which opened on Broadway in 2005, was itself an adaptation of the 1975 film "Monty Python and the Holy Grail", a comedic parody of the King Arthur quest.
Directed by Mike Nichols, the production had received 14 Tony Awards nominations, winning in three categories, including Best Musical.