Director Martin Scorsese has never won an Academy Award Clip of The Departed

Ladbrokes have cut the odds on the film winning best picture to 10/11, while Scorsese is 1/3 favourite to win his first Oscar, according to William Hill.

Dame Helen Mirren is hot favourite to win best actress for The Queen, with William Hill offering odds of 1/12.

Forest Whitaker is odds-on to win best actor for The Last King of Scotland.

This year's Oscar nominations were announced on Tuesday, with the awards ceremony to be held in Los Angeles on 25 February.

OSCARS BEST PICTURE ODDS The Departed - 10/11 Babel - 9/4 Little Miss Sunshine - 4/1 The Queen - 8/1 Letters from Iwo Jima - 12/1 Source: Ladbrokes

In the best picture race, The Departed's closest challenger is Babel, according to Ladbrokes, followed by Little Miss Sunshine, The Queen and Letters From Iwo Jima.

A Ladbrokes spokesman said: "We opened at 5/4 [for The Departed] but had to go odds-on when the money flooded in.

"Often the early money is the best guide to where the gongs are heading."

The bookmaker has already stopped taking bets on Dame Helen because, Ladbrokes said: "Punters have gone bonkers for Mirren and we can't take any more punishment."

In the best actor category, Whitaker's main competition is expected to come from Peter O'Toole and Leonardo DiCaprio.

DiCaprio is nominated for his role in action thriller Blood Diamond, which had its UK premiere in London on Tuesday.

DiCaprio and co-star Djimon Hounsou are both up for Oscars Clip of Blood Diamond

"I couldn't be happier," DiCaprio said in Leicester Square. "This is a movie I am very, very proud of."

DiCaprio, who also appears in The Departed, said he would be "rooting" for Martin Scorsese to win best director.

As well as familiar names from Britain and the US, this year's nominations feature a significant number of candidates from Mexico.

Adriana Barraza has been shortlisted for best supporting actress for Babel, while her director Alejandro Gonzalez Inarritu will challenge Scorsese for best director.

Pan's Labyrinth - a fantasy set during the Spanish Civil War directed by Guillermo del Toro - has six nominations, while Alfonso Cuaron was shortlisted in two categories for his dystopian thriller Children of Men.

Laura Ziskin, producer of the Oscars television broadcast, said the diversity of this year's line-up was "thrilling".

Dark fantasy Pan's Labyrinth is up for six Academy Awards Clip of Pan's Labyrinth

"The Academy Awards go all over the world and I think it is only right that we celebrate the industry throughout the world," she said.

It was "obviously a big year for the Mexican film industry", she added.

Speaking from Miami, Barraza called Babel's seven Oscar nominations "a joy".

"American cinema is receiving people from all over the world," she told the Associated Press news agency. "This can open the doors for everybody."

Fellow Spanish-speaker Penelope Cruz, up for best actress for Volver, said she was "a little bit overwhelmed" by her nomination.

But the Madrid-born star said she felt "a bit confused and sad" that her director Pedro Almodovar had been overlooked.