Leonardo DiCaprio will reteam with director Martin Scorsese for Shutter Island, according to Variety.

Drama is set in 1954, with DiCaprio in final talks to play U.S. Marshal Teddy Daniels, who is investigating the disappearance of a murderess who escaped from a hospital for the criminally insane and is presumed to be hiding on the remote Shutter Island.

Production for Shutter Island begins March 2008 in Massachusetts, Connecticut or Nova Scotia.

DiCaprio, 32, and Scorsese, 64, have worked together on three other films–Gangs of New York, The Aviator and The Departed.

Oscar nominees arrived at the Academy Awards Nominees Luncheon at the Beverly Hilton Hotel yesterday. The actual award show will take place on Sunday, Feb 25. with Ellen DeGeneres as the host. Check out the pictures below; many more after the jump!

Attendees included: Djimon Hounsou, Mark Wahlberg, Leonardo DiCaprio, Steven Speilberg, Clint Eastwood, Eddie Murphy, Helen Mirren, Jennifer Hudson, Penelope Cruz, Will Smith, Jada Pinkett Smith, Melissa Ethridge, Steven Spielberg, Penelope Cruz, Martin Scorsese, Babel star Rinko Kikuchi, director Alejandro Gonzalez Inarritu, Abigail Breslin, and Forest Whitaker.

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Leonardo DiCaprio looked spiffy last night at the 59th annual Directors Guild Of America Awards held at Hyatt Regency Century Plaza in Los Angeles, Calif. Above, Leo stands alongside director Martin Scorsese, who picked up Outstanding Directorial Achievment in Feature Film for the film The Departed. Is Mr. Oscar next?

Said Scorsese during his acceptance speech: “This picture, for me, started out as a genre film. I didn’t think I’d be standing here today, I really didn’t.”

Pictured below: presenter Steven Spielberg, President and COO of Warner Bros. Entertainment Alan Horn