Perhaps the most obvious answer to the question of why a sequel to "Mrs. Doubtfire" hasn't happened yet — and is unlikely to happen — is because of the tragic death of star Robin Williams, who died by suicide in 2014. Williams completely made the role his own, using his incomparable talent for improvisation to elevate the film from run-of-the-mill family fare to a genuine comedy classic. To make a movie without him now would seem foolish, but that's not to say that it wasn't something being discussed when he was still alive.
In the early '00s, rumors began to circulate about the possibility of a sequel, and at one stage, actor Bonnie Hunt was on board to write the script. This iteration never surfaced, however, and the project went quiet until 2014 when Deadline reported that "Elf" writer David Berenbaum was set to pen the script instead. In an interview with Entertainment Weekly, director Chris Columbus spoke about how close the sequel was to being a reality, saying, "We said for years that we would never do it. Then somebody came up with a really interesting idea, and we agreed to develop a script."
In the same interview, Columbus tragically revealed that the conversations about a "Mrs. Doubtfire" sequel were some of the last ones he had with Williams, whose untimely death immediately halted the chance of a sequel — perhaps indefinitely.
If you or anyone you know is having suicidal thoughts, please call the National Suicide Prevention Lifeline by dialing 988 or by calling 1-800-273-TALK (8255).