According to the French book La saga des Jeux Videos, by Daniel Ichbiah, the original title would have been In the Dark. The idea came from the Infogrames' PDG, Bruno Bonnell, and one of his collaborators, Eric Mottet. The player would have been constantly in the dark, having only 3 matches he could use to progress. Frédérick Raynal, an Infogrames coder who was working on a 3D engine in his free time, tried to integrate the project very soon, but he didn't succeeded in convincing Eric Motet. He then finished his 3D engine and made a demo with an Infogrames artist Didier Chanfray. The result was shown to the managers in 1991 and it was judged so good Raynal became the project leader. After a first attempt by the team itself, the scenario was written by Hubert Chardot, an independent writer who had worked for the 20th Century Fox and was a real Lovecraft fan. The definitive version was finished in only 3 afternoons, the whole team participating. Chaosium, judging it was unfaithful to Lovecraft's work, refused to validate it, thus losing any right to perceive royalties on it. It's also at this moment that the definitive title was chosen. Last but not least, when the project was in its early stage, Frederic Raynal met Yael Barroz, an Infogrames artist which integrated the team. They married very soon.
The story was inspired by a supposedly true event. A man by the name of Edward Carnby spent a night in an old house by the name of Decerto to prove that it wasn't haunted. The following morning it is reported that Carnby used a pay phone to call someone called Gloria Allen and according to a witness he looked like "he'd been fighting 'gators all night."
Alone in the Dark appears in the book 1001 Video Games You Must Play Before You Die by General Editor Tony Mott.
Before its release, Infogrames announced that Alone in the Dark would be the first in a new series of games; The "Virtual Dreams" series. Each game would have a totally different plot and setting, but they would all use the same engine. The original Alone in the Dark box (at least, in Europe) had different cover art, and featured the "Virtual Dreams" title. The game was later re-issued in its current box design, and there was no further mention, from Infogrames, of the "Virtual Dreams" series.
All backgrounds were rendered in 3D via multiple camera angles, then converted to 2D.