Many critics believe that The Night of the Iguana was Tennessee Williams's last great play. Howard Taubman of the New York Times writes, "For Mr. Williams, The Night of the Iguana marks a turning point. When compared with the best of the preceding plays, this work of subtle vibrations reflects a profound change. It goes beyond the elimination of the explosive and shocking gestures, which have given some of the other works the fillip of being sensational and scandalous, and reaches into the playwright's attitude towards life.’’ A concurring critic, Harold Clurman of The Nation, finds Williams's writing to be superb. He says, ‘‘The writing ... is lambent, fluid, malleable and colloquially melodious. It bathes everything in glamour.’’

Numerous critics believe the character of Hannah is key to the play's success. An unnamed critic in Life argues, ’’The Night of the Iguana is Williams's best play in many seasons, and Hannah drives home—more explicitly than any of his other characters ever has—the heart of his writing.’’ Taubman agrees when he writes, "No character of Mr. Williams' invention has had the heartbreaking dignity and courage of Hannah Jelkes....’’ Even an unnamed critic in Time, who calls the plot "sketchy," finds something to like. This critic writes, ‘‘It is Hannah's kindness to be cruel.’’

The other main character, the fallen Revered Shannon, is seen by most critics as more typical of Williams, but he still has some distinctive attributes. Clurman of The Nation argues that "There is very little indulgence in the portrait of Reverend Shannon.’’ Glenn Embrey in his essay "The Subterranean World of The Night of the Iguana,'' believes Shannon's fate defines him quite differently than other tortured souls in Williams's plays. He writes, "The main character of The Night of the Iguana seems to escape the violent fate usually in store for Williams's heroes. True, desire has been ruining Shannon's life for the past ten years, but at the climax of the play he manages to form what promises to be a lasting sexual relationship with a mature woman. This optimistic ending appears to make Iguana very different from the serious plays that precede it; for the first time hope breaks across Williams's bleak world.’’

One source of controversy among critics is the function and power of the minor characters. Some see the group of German tourists who pop in and out of the story as extraneous. These critics believe the Germans serve no real function in the plot but to give it a sense of time and some comic relief. Other critics like them for their reactions to the main plot.

Some critics dislike the play overall, but find moments of merit. Richard Gilman in The Commonweal writes "The talk is that the play is Williams's best since Cat on a Hot Tin Roof, and the talk, for once, is right. But it seems doubtful that is right for the best reasons. . . . [T]wo things have mostly been ignored. The first is that The Night of the Iguana perpetuates nearly all of Williams's failings as a dramatist....’’ Similarly, an unnamed critic in Newsweek writes "At no time does Iguana achieve the single, dramatic clap of thunder that will clear the troubled air....’’

Other critics who dislike the play find it too similar to previous plays written by Williams. Robert Brustein in The New Republic writes ‘‘In The Night of the Iguana, Tennessee Williams has composed a little nocturnal mood music for muted strings, beautifully performed by some superb instrumentalists, but much too aimless, leisurely, and formless to satisfy the attentive ear.... [H]e has explored this territory too many times before—the play seems tired, unadventurous and self-derivative.’’ John McCarten of The New Yorker finds fault in the use of the characters. He writes "The Williams genius for making assorted bizarre types believable is in evidence, all right, but our interest in them is aroused only sporadically." Later in his article, Brustein of The New Republic writes, "let us put down The Night of the Iguana as another of his innumerable exercises in marking time.’’