Rochester, New York, native Frank LaLoggia based the film on a popular and long-standing local urban legend known as "The White Lady." Legend has it that the White Lady had a daughter who disappeared at the hands of a predatory young suitor, and so the White Lady roams the lake front to this very day, searching for her missing daughter. The supposed residence of the White Lady is actually the base of a demolished hotel that was built in the 1800s. Known as the White Lady's Castle, it has become a popular tourist attraction and party site for teenagers.
Director Frank LaLoggia asked his friend Richard Jay Silverthorn, who portrayed the adult Lucifer in Fear No Evil (1981), to create a mask that Frankie would use that was "representative of Bela Lugosi's guise in Dracula (1931)". Compare that mask at 05:50 with the statuette of Count Dracula at 49:48. Unfortunately, this connection is lost on most viewers who, immediately on seeing it, think the mask is of Richard Nixon.
On the DVD commentary, director Frank LaLoggia says that he got the idea for using the song "Did You Ever See a Dream Walking?" (which is a significant plot element in the movie) from hearing it in the Eddie Cantor movie Roman Scandals (1933). Actually, this song does not appear in the Cantor film; it was written for the musical Sitting Pretty (1933). Both "Roman Scandals" and "Sitting Pretty" were released in 1933.