‘We’re not a bunch of bloody hippies,” Mike Shepherd growls by way of introduction. Turns out the last time a journalist paid Kneehigh a visit at its Cornish home, that was the verdict. The time before, the company wound up being compared to a cult, the rehearsal rooms a commune. Its artistic director has had enough.

Kneehigh’s headquarters are in Truro, but its heart is in Gorran Haven, a little village on Cornwall’s south coast. Bunting hangs, house to house, over its winding streets, and kids in wetsuits trot home from the beach. Seagulls sit on every other antenna. The nearest rail station is half an hour away by car.

Up the hill, a 10-minute climb, is a clump of old granite barns where every Kneehigh show starts its life. Rehearsals begin with an intensive retreat: at least two weeks tucked away together, with creative sessions blurring into beach trips, campfire get-togethers and company meals. Its new show is an adaptation of The Tin Drum, Günter Grass’s horrified satire on nazism, and the process is no different, even though this is the biggest show Kneehigh has ever made.

The garden is dotted with pansies and pink geraniums; kissing benches are tucked between wooden sheds: one is a costume store, another a workshop. Writer Carl Grose is staying in the third, which has a “Welcome” sign hung over the door.

Round the back, an old milking parlour serves as a rehearsal room, but today, the actors spill outside onto a square lawn and play volleyball in the field next door. “It’s easy to get romantic about it on days like this,” says Shepherd, “but when I came here a few weeks ago, the place was in a right state. The garden was dead. Everything was mouldy.”

Inside, the barns surround a large, homely kitchen with a long dining table running down the middle. A giant rota of responsibilities is written up on a whiteboard. Everyone – actors, stage managers, creatives – takes a turn on kitchen duties, and the whole company eats together every day: “a quickfire way of creating an ensemble”, Shepherd says. Today, much to his dismay, two trays of Cornish pasties sit on the side. “Oh, lord,” he groans in his cockney-Cornish burr. “It’s usually quinoa and halloumi.”

There’s bric-a-brac on every surface – old props and puppets, bits of driftwood and string, shelves full of scripts, textbooks and trashy thrillers. It’s a living Kneehigh museum, and on every wall hang framed production photos. The Unloved, from the recently revived Tristran and Yseult, sit in red velvet stalls in their balaclavas and macs; a prim wartime nurse cycles across the poster for A Matter of Life and Death at the National; and a couple mid shag in front of rusty neon hails from its RSC Don John.

Kneehigh’s shows are known for their sense of life. Each is a mishmash of styles: knockabout comedy mixed with runaway romance; rough edges and raucous mischief. One rust red wall is stencilled with words such as wonder, irreverence, anarchy and joy. It’s a Kneehigh manifesto – the ingredients it works with. Critics sometimes sniff, particularly when the company intrudes on hallowed cultural spaces, but the shows are crowdpleasers to their very core. Shepherd wouldn’t have it any other way. “I bloody hate the stalls,” he hisses conspiratorially. “I’d rip them all up.”

If you’ve seen a Kneehigh show, chances are you’ve seen Shepherd on stage. It’s where this born performer belongs. Ask him a question and he’ll act out an anecdote. At 65, he has the energy of a much younger man. The dress sense too: black shorts and a grey-pink T-shirt festooned with skulls today. A tattoo of a bright blue lobster extends down his right calf.

A little way from the barns, a sandy beach spans off to the right. To the left, a coastal path plunges through grass and thick gorse. This is where, every morning, the company comes to warm up. “We run the cliff path,” Shepherd says, which well explains his own wiry, rugged physique. “We end up a bit weather-beaten, the opposite of your rarefied stage actor. There’s a robustness and a power in our actors, vocally and physically, which make their way into the work as well.”

Cornwall, in other words, gets into the shows. And yet the director has “despaired of Cornwall recently – the fact it voted Ukip, then Brexit”. He moved back to London a few years ago.

As a child, he came the other way after the war, returning in his late twenties, frustrated by life in London, “waiting by the phone, going to auditions and never getting a job”. He took a teaching job in Cornwall in 1980 and set up his own theatre company shortly afterwards – “not for theatre-goers, but for the community”. With him were a thrash guitarist, a farmer, an ex-dancer and a supermarket signwriter – and so Kneehigh was born. They were, Shepherd glints, “a weird bunch of people”. Rehearsals happened at night after work. The shows were “anarchic and crazy”.

Indeed, Shepherd spent the first show being chased by police for performing without a licence. “Every time I came off stage, they’d go ‘Oi’, and I’d run round the other side. I managed to get to the end of the show, then my arms were behind my back and I was hoiked off to the station.” Some started with stunts – cyclists somersaulting off harbour walls into the water. Others led audiences on wild walks through the woods.

Kneehigh has evolved in the years since, but its signature style is best associated with Emma Rice. She joined the company as an actor in 2000, and soon took the helm. “With Emma, every story became personal,” says Shepherd, “Find a connection and the story comes to you.” Even two years after heading off to Shakespeare’s Globe (albeit temporarily), Rice still crops up in conversation unprompted at Gorran Haven all the time. But Kneehigh has moved on, stylistically. Dead Dog in a Suitcase, its spin on The Beggar’s Opera, had an extra edge; a little less cute, a lot more angry. Less Rice, more Shepherd. The Tin Drum follows suit. “It comes from a real desire to do stuff that’s contemporary and political,” Shepherd stresses.

Grass’s novel is a modern classic; an allegory for 20th-century horrors. Its three-year-old hero, Oskar, opts to stop growing – a rejection of adulthood in the face of fascism – and resists the Nazis by banging on his toy drum. “It’s like a forest of all sorts,” says adaptor Grose. “Biography, history, magical realism, folk tale.” This ragbag suits Kneehigh well, and its politics seem increasingly pressing.

What it does have, undoubtedly, is a sense of theatre. Oskar will be played by a puppet with deep black beads for eyes, and his drum will generate more than a biscuit-tin beat. Instead, composer Charles Hazlewood has turned to drum-pad technology. “In the book, the drumming exists in your imagination,” he says, “You hear whole symphonies, breakbeat, sleazy ska, drum and bass – whatever you want.”

In the rehearsal room, expansive beats burst out alongside the action. Actors try to keep up, singing along, as Shepherd pushes them to toy with the material. Try it like this, he suggests; show me that. “Don’t analyse. Don’t ask why.” Hazlewood reckons his philosophy is rare: “So often in theatre, there’s an atmosphere of faint coercion – damaged egos being territorial. What Mike promotes is an atmosphere where anything goes.”

Shepherd doesn’t buy the clean, concentrated vibe of most rehearsal rooms, particularly those with “barricades of laptops”, nor the idea that creativity runs by the clock. “It breeds fear,” he says. Instead, he seeks inspiration in that clutter. Actors dash off to make costumes. They’re sent to create small shrines to their characters with whatever they can lay their hands on. “Day one, we’re starting to use costume, props, mock-ups of the set,” he explains, “We’re using dance, text, puppetry, music – all of it – like a big dressing-up kit.”

The clutter has an another purpose. It instils a sense of history and, with it, identity. Old shows feed into new ones, as costumes and props get recycled. Someone grabs something and, all of a sudden, it has a new lease of life in a whole other show. It’s one of the reasons Kneehigh has such a distinctive style. It feeds off itself more than taking inspiration from others.

Remoteness plays a part in that too – no distractions, no diversions. “It’s slightly unfortunate that the mobile phone signal’s improved,” says Hazlewood, “It used to be dreadful. You had to go off to the top of the car park just to get one bar.”

As evening falls and drinks come out, Shepherd sums it all up. “Me and Emma always used to call Kneehigh The Church of the Lost Cause. I’m not religious but, in a sense, I think theatre can replace the church. You just have to remind people that they love it. They love stories, they love playing, they love being entertained.” Kneehigh’s not a cult or a commune, but a congregation. “It makes sense of the world, performing.”

• The Tin Drum is at the Liverpool Everyman, 28 September-14 October. Then touring.