A small-town tragedy from the past quite literally comes back to haunt a group of high school classmates in "The Gallows," a methodically paced suspenser that unnerves enough for the viewer to forgive it for its commonplace—and not always plausible—found-footage conceit. Made by first-time writer-directors Travis Cluff and Chris Lofing for under $100,000 before producer Jason Blum and his Blumhouse Productions took it on and sold it to distributors Warner Bros. and New Line Cinema, the film has a plucky, home-grown quality that adds to its raw authenticity. When a lot of movies told through a first-person visage are too glossy for their own good, this one excels by retaining a suitably unpolished yet still skillfully conceived sheen. It helps that the premise is a sure-fire humdinger, ingeniously eerie yet feeling all the same like a lost slasher from the 1980s. Aspiring horror filmmakers, prepare to be jealous over having not thought of it first.

On October 29, 1993, the Nebraskan town of Beatrice was rocked when a prop malfunction during the high school production of a play called "The Gallows" led to the accidental onstage hanging of lead actor Charlie Grimille. Twenty years later, Beatrice High is days away from putting on an anniversary revival of "The Gallows." Taking on the role previously portrayed by Charlie, football player Reese (Reese Mishler) worries that he is in over his head and destined to let down his female co-star (and crush) Pfeifer (Pfeifer Brown). When Reese's loud-mouthed videographer friend Ryan (Ryan Shoos) discovers the stage door is broken and doesn't lock, he convinces Reese the best thing to do to save face is to sneak into the school overnight and trash the sets on the eve of the play's premiere. Reese isn't so sure, but his fear of failure gets the best of him. Once inside the dark and desolate building, Ryan, Reese and cheerleader Cassidy (Cassidy Gifford) get to work on their misguided plan until Pfeifer shows up unannounced, devastated that Reese would try to ruin a show on which she has worked so hard. Their luck goes from bad to worse when the stage door suddenly won't open, trapping them inside the school with an unknown entity seeking retribution for Charlie's death.

"The Gallows" is a directors' movie, and this one has two talented artists at the helm. Travis Cluff and Chris Lofing have been candid in interviews, admitting that their debut feature was shot found-footage style as a cost-saving measure, and it is always disappointing to hear that corners have been cut and creative visions compromised by a film's budget. Indeed, "The Gallows" would have worked even better as a conventionally shot narrative, and there is a very specific point in the story when all hell breaks loose where it is no longer believable that anyone—let alone multiple characters—would still be reaching for digital cameras and phones to record themselves being terrorized. This leap in logic threatens to take the viewer out of the harrowing goings-on, as does the protagonists' seeming inability to find a solitary window to shatter or weapon with which to break down a door.

Fortunately, the film is otherwise so formidably crafted that it is easy to brush off the script's trouble spots. The backstage milieu of a high school theatre production is arrestingly depicted from the start, drawing one into the chaotic excitement and jittery butterflies that come with the approach of opening night. There are specific character types—the bully, the cheerleader, the sensitive football star, the aspiring actress, the nerdy outcast—but in their own John Hughesian way they are rarely over-the-top caricatures. The one exception to this is resident cameraman and lead instigator Ryan, whose know-it-all obnoxiousness is so overbearing it is impossible to empathize with him for even a second. It is lucky, then, that he is off-screen for the majority of time and is mostly heard and not seen. The freak accident at the plot's center, captured in the indelible opening scene with a consumer-grade, early-'90s camcorder, is absolutely chilling. Once the friends are inside the school's tenebrous auditorium, long corridors and maze-like maintenance areas, Cluff and Lofing build unease with a deliberate escalation of tension, never prematurely spilling the bag of tricks they have at the ready for their increasingly frightened characters. A sequence where they come upon old news footage about the tragedy mysteriously playing on a janitor-room television, and other segments involving a wardrobe room and a catwalk of horrors above the stage, are supremely menacing, a startling mélange of the unknown.

A certain suspension of disbelief is required as "The Gallows" plays out, not only in regard to its frayed found-footage approach, but also in key plot revelations that unbelievably come as surprises to characters who have grown up in this town and lived for years with this grim stain on their history. Judged on its respective merits as a genre picture favoring audience apprehension and the power of suggestion over graphic violence, however, it works like gangbusters. The interiors of the school are exquisitely used, draped in a foreboding loneliness all the better to have danger lurking in the shadows. The cloaked killer, when finally glimpsed, is not only intimidating, but also legitimately creepy. The film mischievously toys with the allure of safety at one point, only to pull it out from under a character who makes a fatefully selfless decision. The ending, circuitously blurring the lines between art and reality, and the past and the present, is especially stirring in its freakish, almost avant-garde poetry. Writer-directors Travis Cluff and Chris Lofing hit the jackpot when their small, shoestring-budgeted effort was bought by a major Hollywood studio and scheduled for a summer release on thousands of screens. What they have ultimately created isn't just a fun scare show, but a directorial calling-card suggesting what they could be capable of when their financial means one day match their fertile ambitions. Intellectually, "The Gallows" may not hold up to close scrutiny, but as a meticulous exercise in dread there is no denying how well it works.