According to The Hollywood Reporter, the Emmy nominated actress is replacing Oscar nominee Michelle Williams in the Maurice Sendak adaptation.
The trade paper insists that nothing was wrong with the "Brokeback Mountain" star's pipes, but the filmmakers wanted to go a different creative direction with her particular beast.
The story revolves around a boy named Max. In trouble and sent to bed without supper, Max -- clad in a wolf suit -- goes off to magical world populated by giant beasts.
Warner Bros. will release the film in the fall of 2008.
Ambrose, who earned a pair of Emmy nods for her work on "Six Feet Under," will next be seen on the small screen in the FOX comedy "The Return of Jezebel James." Her latest big screen effort, "Starting Out in the Evening," is also attracting strong buzz.