The campaign, shot by Paul Weiland through The Paul Weiland Film Company, is the first work from Euro RSCG since it won the £20 million Argos account from Ogilvy & Mather earlier this summer.
It is part of an effort to change consumers' perceptions of the retailer as being downmarket, broaden its appeal and attract a wider customer-base.
The initial 40-second branding work breaks on 26 August and coincides with the launch of the company's autumn catalogue. It will be supported by an ongoing flow of tactical messages and promotional campaigns at key times in the retail calendar.
Media planning and buying is through MindShare.
Grant stars as Zak, a pretentious and demanding rock-star celebrity, and Sawalha as his efficient PA, Pam. She is charged with the task of refitting his apartment while he is away on a come-back tour, after his ex-wife stripped it bare.
Instead of pandering to his demands that a top designer do the work, Pam raids her local Argos, and the results meet with Zak's approval on his return.
He looks befuddled when she explains that the entire flat was kitted out by Argos, but fools him by changing the name to "Arr Ghoos", a "top Lithuanian designer whom Zak thinks is highly trendy.
Euro RSCG's managing director, Adam Leigh, said: "The campaign directly and humorously addresses the stigma that a non-Argos user feels to the brand. A great retailer should expect great advertising, and we believe this will seriously shift attitude and sales."
Argos' marketing director, Paul Geddes, added: "Argos is one of Britain's best kept secrets and this advertising is going to engage a whole new audience with the brand. Argos was ahead of its time in championing accessibility via multiple routes to purchase, and the ads communicate the core benefits of convenience, range and value. Richard and Julia are the perfect stars for the campaign and we are delighted with the results - people are certainly going to be surprised."
Euro RSCG won the account in May, ending Argos' 13-year relationship with O&M, and the latest work marks a dramatic change in its strategy.
Previous work has included the "Brighter shopping, brighter prices TV campaign, as well as product-led ads starring the model Melinda Messenger and spots using a sunflower as a logo and featuring the song Sunshine on a Rainy Day by Zoe.
Argos is part of GUS, which has ambitious growth plans for the chain.
It saw a 14 per cent jump in sales over the crucial Christmas selling period in 2001. It is planning to increase the number of stores in the UK to 500 by the end of the year.
The campaign was written by Dom Gettins and art directed by Olly Caporn.