Although A Nightmare on Elm Street would become one of the most popular horror franchises of all time, even as production on the first movie came to an end during the summer of 1984, none of the principals involved had given any thought to the possibility of a sequel. Writer/director Wes Craven had forfeited his rights to the story and characters in order to finance the picture, while New Line Cinema had staked their entire company on the gamble that the movie would be a success. But as soon as the box office takings were counted, studio president Robert Shaye needed little convincing that a second film would be a sound investment. ‘I’ve been accused of fighting for movies that could have sequels but that wasn’t really the case. I just felt the ending to the movie didn’t send the audience out with any great excitement,’ stated Shaye in the 2010 documentary Never Sleep Again: The Elm Street Legacy, regarding his decision to add a short epilogue that indicated the film’s antagonist, Freddy Krueger, had not been defeated.

With heroine Nancy Thompson having lost all of her friends and mother to Freddy, she comes to the realisation that it is her fear that has given him power over her. Turning her back on him, she takes away his strength and Freddy is once again banished to the dream world. ‘We were uncertain about the ending,’ Shaye continued. ‘We didn’t really feel like we had it right. Wes wanted the ending to be that she woke up in the morning and the sun was shining and she walked away.’ A Nightmare on Elm Street would become an unexpected success and transformed New Line from a struggling distribution company to a major Hollywood studio, while Craven would become inundated with offers for other genre pictures. Having been denied the chance to cast his influence over the critically-reviled sequel A Nightmare on Elm Street Part 2: Freddy’s Revenge, Craven had been disappointed with the end result, feeling that it had violated many of the rules he had introduced in its predecessor.

‘My feeling was the initial Nightmare was about something fairly serious: the presence of evil, especially adult evil, directed towards the innocents of the world, embodied in children,’ explained Craven to author Maitland McDonagh. ‘It was a subject that had to do with terror, with release of vicious intent and it was not a joking matter. I know New Line’s attitude was much more, ‘We want to make a date movie,’ something where you scare the girl a little bit so the boy can feel comfortable putting his arm around her. Another time they referred to their ambition to ‘devise the perfect cheeseburger,’ something they could keep cranking out and people would keep buying. I think their attitude and their stance towards the films was much less artistic and much more commercial…They tend to think in terms of gimmicks and visual effects, not in terms of substance or character. Because of that, the movies degenerate into a series of set-pieces about not much of anything at all.’

The story for Freddy’s Revenge had moved away from Craven’s original concept of the monster attempting to lure children into his dream world and would instead explore his ‘seduction’ of a young man in order to gain possession of his body, thus finally escaping back out into the real world. With Craven refusing to participate, the studio had instead turned their attention to another rising filmmaker from within the company, Jack Sholder. Having initially worked as an editor on a series of low budget pictures, including the cult slasher The Burning, Sholder eventually made his directorial debut in 1982 with the thriller Alone in the Dark, which would demonstrate his talent for building tension. Impressed by his work on the film, Shaye and his producer Sara Risher would offer him the opportunity to helm a more commercial project.

‘Wes was supposed to direct Nightmare 2 but backed out six weeks before the start of photography, primarily because he felt the script did betray his original concept. I had done a bit of editing work on the original and was very familiar with it, so they offered me the film. I wasn’t sure I wanted to do another horror film, especially a sequel, which at that time was mostly looked down upon,’ Sholder explained to Love-It-Loud. ‘I don’t think it’s anywhere near my best work. I frankly never was that impressed with the original at the time; I’m more impressed now. Nobody at New Line certainly had any idea why the film was such a hit. In fact, Freddy wasn’t even on the original poster…With only six weeks to prep the film, shooting in L.A. while I was still living in N.Y.C., was pretty daunting. I was frankly scared to death and had no idea how I could possibly pull it off. The script was set, to the point that New Line would rather lose Wes than rewrite it and I was just trying to hang onto a Bucking Bronco.’

While sharing some of the disappointment for how Freddy’s Revenge had turned out, Robert Englund, the actor who had transformed Freddy Krueger from a mere monster into a pop culture icon, was desperate to return to the role a third time and so began to develop a treatment of his own for A Nightmare on Elm Street Part 3, which he had called Freddy’s Funhouse. The story would follow the sister of Tina Gray, one of the teenage victims of the first movie who, haunted by the events that have torn her family apart, begins to investigate the truth behind her death. ‘The film would open with her going through all the microfilm at the local library, all the newspaper clippings pertaining to both A Nightmare on Elm Street and Nightmare 2, as well as some local news station footage of Freddy on the City Hall steps with his lawyers after he got off from the very first case,’ Englund told Fangoria. ‘So, you would see me playing Freddy as this disgusting janitorial Lee Harvey Oswald-type. I liked that sense of summation. Maybe we’ll still do something like that.’

By the end of 1986 New Line were still unsure on how to proceed with the series following the negative reaction to Freddy’s Revenge. Initially the studio would start talks with Paramount Pictures about developing a crossover picture with their own horror franchise Friday the 13th, in which their slasher villain Jason Voorhees would fight Freddy to the death. ‘That was something that would have gotten me excited,’ admitted executive producer Frank Mancuso Jr., who in recent years had been responsible for nurturing the Friday the 13th brand. ‘It would have been like going back to Dracula vs. Frankenstein and updating it. But New Line would never agree to let Paramount release it domestically, which was the big stumbling block. The idea was that Paramount would distribute it here and New Line would distribute it overseas, but they just wouldn’t go for it.’

With Freddy vs. Jason remaining in development hell for the next fifteen years it was decided that a third Elm Street film would be rushed into pre-production. And despite having declined the opportunity to work on the previous sequel, Craven was contacted once again by the studio with the opportunity to develop a true successor to his origin concept. Shaye had been disappointed with Freddy’s Revenge, feeling that it lacked the winning elements that had made Craven’s film such a success and so wanted to bring the filmmaker back to the series to develop what he hoped would be a more worthy follow-up. The first decision that Craven and Shaye would agree upon regarding the story was to bring back the characters of Nancy and her father, Donald. Despite having written the script for the original movie by himself, Craven had already committed to another project entitled Deadly Friend and so turned to an aspiring writer, Bruce Wagner, for assistance.

I might well try to jump in at the last minute and direct Nightmare 3

Craven had been introduced to Wagner through a filmmaker called Paul Bartel, who would direct Wagner’s second script Scenes from the Class Struggle in Beverly Hills two years later. With Craven balancing several projects and having little time for A Nightmare on Elm Street Part 3, he asked the young writer to adapt his concept into a screenplay. ‘Bruce and I are writing together, talking through everything. He has actually been putting the stuff down on paper,’ Craven told Fangoria in 1986. As well as Deadly Friend, Craven would be linked to several other pictures during this time, including Superman IV – eventually directed by Sidney J. Furie and released in 1987 as The Quest for Peace – and, as Wagner would reveal during an interview with Spike Magazine in 2002, Beetlejuice. ‘I’m contractually obliged to a pay-or-play deal on another film, Haunted, a love story about a guy, a girl and a ghost for Heron Communications, whose parent company is Media Home Entertainment, one of the big funders of the Nightmare series,’ said Craven on what would become Beetlejuice. ‘If Haunted does fall through, I might well try to jump in at the last minute and direct Nightmare 3. But otherwise, it’s just being written by myself and Bruce Wagner.’

Craven and Wagner’s script would begin five years after the events of A Nightmare on Elm Street, in which Nancy’s father (renamed John for some unexplained reason, perhaps a confusion with actor John Saxon) has quit the police force and searched the country in an attempt to locate the birthplace of Freddy, thus uncovering the truth behind his monstrous legacy. Nancy has followed her father over five states but has always been one step behind. The opening sequence would see Freddy’s infamous claw tearing its way out of a pregnant stomach, before the camera pans back to reveal a derelict farmhouse…Freddy’s childhood home. After falling asleep behind the wheel and losing control of her car, Nancy wakes up in a field as a kind-hearted doctor, Neil Guiness, shines a light in her eyes. Concerned for the young woman, he offers for her to spend the night in his guest room while her car is fixed. Later that night, Neil discovers Nancy thrashing violently in her sleep and notices a bottle of pills by the side of the bed; an experimental dream suppressant called Hypnocil.

Accompanying Neil to his hospital the following morning, Nancy is introduced to a group of young patients who have all attempted to take their own lives after being plagued by a series of horrific nightmares. The latest patient to arrive is Kirsten Parker, who has been admitted after slitting her wrists, but to Nancy’s horror the girl begins to sing a nursery rhyme that would remind her of Freddy Krueger. When Neil returns Nancy to her car the police are on the scene, having found the body of a young hitchhiker who Nancy had offered a lift to before falling asleep and crashing her car. Nancy looks over at the farmhouse nearby and recognises it from one of her the nightmares. Neil informs her that he had been there himself a few weeks earlier when a man was apprehended trying to burn it down, as he claimed the house was ‘alive.’ Nancy insists on Neil showing him the patient, only to discover the so-called schizophrenic is her own father.

‘We’re exploring not only dreams but other states of altered reality within the human consciousness and we’ll be trailing through all of them. Also, this house will be sort of an architectural portal to that world. It is virtually a limitless world of the human psyche in all its dimensions, many of which will be explored,’ Craven told Fangoria in the same issue, while also insisting that his story would ignore both the characters and events from Freddy’s Revenge. He would also reveal an important element from his script; a group of teenagers who would have the power to defeat Freddy in the dream world. ‘There will be a group of very special kids who will align themselves with Nancy and her father to fight Freddy. Freddy is about to pass on to a higher level of evil, greater powers, expanded effects on others. Freddy’s moving up. These people are the last stand against him before he gets so big that no one can stop him.’ These children in question would come to be known as the ‘dream warriors,’ of which Kirsten would prove to be the most powerful and the key to their strength.

With Craven obligated to deliver a first cut of Deadly Friend even as New Line were anticipating the script to A Nightmare on Elm Street 3, Wagner would take the basics of Craven’s story and adapt them into a screenplay, which would be notable for upping both the violence and brutality of Freddy. Submitting the script to New Line, Shaye and Sara Risher – who first joined the company during the mid-1970s when they were specialising in the distribution of cult and foreign movies – were intrigued by the concept but felt that it lacked the commercial appeal of the first film. Deciding that the script needed to be rewritten, Risher was approached by Rachel Talalay, whose work as a production manager on each of the Elm Street pictures would eventually lead to her directorial debut with 1991′s Freddy’s Dead: The Final Nightmare. It would be Talalay who would recommend a pair of young writers that she felt would be able to further develop the story and deliver a script that would be more suited to their needs.

‘On every Nightmare I would go back to Wes Craven and ask him if he was interested, so Wes wrote the original script for Nightmare 3…But it didn’t quite work. It was a very ambitious script but it didn’t have a lot of the human vulnerabilities and the characteristics we wanted,’ recalled Risher. ‘We were in the process of rewriting that script with Wes when our producers at the time had met with some young, smart, up-and-coming writer/directors; Frank Darabont and Chuck Russell. And they said, ‘Please hear their pitch. They have a great pitch; we think this is the best way to go.” Risher would agree to meet the two writers and was so impressed with their proposal and how it could lend itself to the world of A Nightmare on Elm Street that they were immediately brought onboard to develop a new screenplay, taking whatever elements they felt had worked with Craven and Wagner’s draft and fashioning a more commercial picture.

Both Frank Darabont and Chuck Russell had already gained experience within the horror genre prior to forming a writing partnership that would also result in the 1988 remake of The Blob. Darabont’s first foray into filmmaking came with a short piece entitled The Woman in the Room, based on a Stephen King story that would prove to be the first of several adaptations he would make of King’s work, later followed by the critically acclaimed dramas The Shawshank Redemption and The Green Mile, as well as the supernatural horror The Mist. Russell had relocated from Chicago to Los Angeles during the late 1970s and had made the acquaintance of exploitation filmmaker Tom DeSimone; working as a first assistant director on the 1977 sex comedy Chatterbox and as executive producer on the 1981 slasher Hell Night. In 1984, Russell turned to writing with the supernatural thriller Dreamscape, which would eventually bring him to the attention of Talalay. ‘The whole series was in question. They didn’t know if they wanted to continue, so I was pushing the company itself; ‘Let’s make the third more fun, let’s take the boundaries of imagination a little bit further in the whole series,” claimed Russell on the influence he would have over the tonal change within the series.

Determined to transform Craven’s concept into something more marketable, New Line gave Darabont and Russell a certain amount of creative freedom in which to explore the world of Freddy Krueger, although the failure of A Nightmare on Elm Street Part 2 would hang over the project throughout its development. ‘When we went into this we knew we couldn’t be scarier than number one. I was a huge fan of number one and this was my chance to direct and I dragged Frank into the situation,’ explained Russell during a screening of the movie in 2008 at the New Beverly Cinema in Hollywood, hosted by screenwriter Diablo Cody. During the same interview Darabont added, ‘We had eleven days to rewrite the script and so we hopped in his car and we drove up to Big Bear to this rented cabin. And we jumped in this rented cabin and for eleven days we’re writing like the bastard son of a hundred maniacs.’

With less than two weeks to work, Russell would fall ill during his time at the cabin, with his temperature eventually reaching a hundred and four degrees, resulting in Darabont having to drive his friend to the nearest hospital. Despite the various setbacks, the script was delivered to New Line on time and, impressed with its commercial appeal and vivid storytelling, Russell was finally given his chance to direct. While they had intended on keeping their story as faithful as possible to the original script, there would be a lot of significant differences between Craven and Wagner’s draft and the version eventually submitted by Darabont and Russell. Although both would focus on a group of gifted youngsters, the latter drafts would see Nancy as an expert in dreams and newly recruited by a hospital that treats suicidal teenagers, with her own experiences with Freddy allowing her to sympathise with her new patients.

Other changes would include Neil Guiness, who would be renamed Neil Gordon, while several of the younger characters would also change; in Wagner’s script Taryn is described as a ‘fifteen-year-old black girl,’ but in the movie she would be portrayed by twenty-six year old caucasian actress Jennifer Rubin. In the first draft it would be the character of Joey – later depicted as a mute by Rodney Eastman – who would create the papier-mâché house that resembles Nancy’s old home, while in Darabont and Russell’s version it was Kirsten. Nancy’s father would also be changed for the film; no longer determined to destroy Freddy once and for all, he would be rewritten as bitter and drunk, having been demoted from police lieutenant to security guard. Some set-pieces would be adapted by Darabont and Russell and used in a different manner; for example, in Craven and Wagner’s script, Neil’s bottom jaw dislocates and his mouth opens as he turns into a demonic snake, dragging Nancy’s feet between his teeth and attempting to devour her, but in the movie it would be Kirsten who is attacked by Freddy – misspelt Freddie in Craven and Wagner’s draft – in the form of a giant snake.

They added some things I felt were not as good

Yet despite the hype that surrounded the release of A Nightmare on Elm Street 3: Dream Warriors Craven began to express bitterness towards both the studio and its new writers, feeling that once again his vision had been cheapened. In an interview with Fangoria Craven claimed that, ‘What they did was change a lot of names. They did change a lot of things that they felt were too expensive to attempt and they added some things I felt were not as good.’ Angered by his comments, Darabont submitted a letter to the magazine that was published several issues later stating, ‘With all due respect to Wes Craven, I must take exception to his comments about the Nightmare 3 rewrite (issue #62). If it were true that all Chuck Russell and I did was ‘change a lot of names,’ the Writer’s Guild arbitration would never have awarded us screen credit. It would never occur to me to belittle Wes Craven or Bruce Wagner’s contributions to Nightmare 3, which are inarguably substantial. I wish Mr. Craven would afford Chuck and me the same courtesy, even if he is feuding with New Line.’

Risher would later join in the debate during an interview with Cinefantastique, in which she would comment that, ‘I don’t understand why he [Craven] doesn’t give credit where credit is due. Chuck Russell made the script (for Part 3) work. I give Wes complete credit for the terrific idea of these kids – the dream warriors – I’m not faulting that. But Chuck Russell and Frank Darabont turned that script around. They rewrote seventy per cent of it.’ In the years following the release of Dream Warriors Craven would often express his frustration at the evolution of the Elm Street franchise, particularly with how its monster would become a wisecracking villain, appearing in music videos and belittling the menace that the director had so carefully crafted with the first movie. ‘I got a call from Bob Shaye out of the blue,’ Craven would later reveal. ‘And to his credit he said, ‘I’ve heard some interviews with you saying you felt you didn’t get a fair shake and I’d like to try to make that better’ and he did, he went back and gave me retroactive cuts in sequels and he also gave me a little bit of the merchandising and so forth.’

While the reviews that would greet A Nightmare on Elm Street Part 3: Dream Warriors upon its release on 27 February 1987 were a noticeable improvement on its predecessor, by the mid-1980s the slasher film had lost any respect from film critics. The first movie had been an unexpected success and the intelligence and originality that Craven had employed had seemingly given the sub-genre a much needed revival, but many felt that the formula was already starting to become repetitive. ‘It’s slick, it has impressive production values and the acting is appropriate to the material,’ Roger Ebert commented in his contemporary review of the picture. ‘So why did I find myself so indifferent to the movie? Maybe because it never generated any sympathy for its characters. This is filmmaking by the numbers, without soul.’ There were a few, however, who appreciated the movie as a fantasy and within that context admired what the filmmakers had achieved. ‘The film’s dream sequences are ingenious and they feature some remarkable nightmare images and special effects,’ declared Janet Maslin of the New York Times.

Yet regardless of how the critics viewed the movie, Dream Warriors would prove to be a considerable success with audiences, outgrossing both previous instalments at the box office with a final total of $44m from a budget of just $5m. By the time of its release its rival franchise Friday the 13th had already produced six pictures but with horror slowly losing the mainstream popularity it had enjoyed earlier in the decade the future of Freddy seemed uncertain. In an interview following the release of Freddy’s Revenge, Englund even speculated that the third entry could be the last. ‘I can safely say that everybody thinks there’s only going to be one more and I don’t think there’s any more than that for me,’ he claimed. ‘Especially since we’re lucky enough to get Wes Craven back to write it, to ‘wrap it up,’ to put that exclamation point to it.’ Yet merely eighteen months after the release of Part 3 the series would return once again with A Nightmare on Elm Street 4: The Dream Master and its phenomenal success would be enough to convince all parties that there was still plenty of life left in Freddy Krueger.