How the UFO horror Steven Spielberg never made eventually inspired ET

After Jaws announced Steven Spielberg as one of Hollywood's biggest names in 1975, he turned his attention to sci-fi and delivered a true classic of the genre with Close Encounters of the Third Kind just two years later. It's no surprise that he was eyeing up more spaceship action after that and now, in 2024, he's going back to the well with a new UFO movie.

But in the latter part of the 1970s and early 1980s, Spielberg was hard at work on a very different sci-fi horror movie. It would've seen him marry the darkness of Jaws with the wonder of Close Encounters. The project he conceived became known as Night Skies, but it never saw the light of day.

Spielberg began work on what he originally wanted to call Watch the Skies — rights issues thwarted that title — when Columbia Pictures started asking him about a potential Close Encounters sequel. Stung by the way Universal had made Jaws 2 without him in 1978, he began work on a story inspired by the 1955 case known as the Kelly–Hopkinsville encounter.

In that case, police were called to a Kentucky farmhouse where residents claimed they had been in a gun battle with extra-terrestrials. Newspaper coverage of the event brought about the "little green men" trope. Cops found no evidence of the "Hopkinsville Goblins" and most skeptics eventually agreed that the "aliens" were actually great horned owls. But that's no fun.

Read more: Steven Spielberg Has His Own Theory About Those UFOs: ‘What If It’s Us, 500,000 Years in the Future?’ (IndieWire)

Spielberg took this tale and modernised the story, writing about a group of hostile alien scientists who landed on Earth and tried to communicate with livestock before eventually attacking a family's farmhouse. There was no story or character cross-over with Close Encounters.

The director wanted Lawrence Kasdan, with whom he would later work on Raiders of the Lost Ark, to spin his treatment into a script. However, Kasdan was busy trying to wrangle Empire Strikes Back at the time, so Piranha screenwriter John Sayles put a draft together.

Spielberg was under contract to Universal and couldn't direct himself, so he floated Texas Chainsaw Massacre director Tobe Hooper's name to the studio. He also enlisted make-up maestro Rick Baker — best known now for An American Werewolf in London's incredible werewolf transformation — to work on the design of the aliens.

Read more: How two minutes 'An American Werewolf in London' still inspires shock, awe and howls 40 years on (Yahoo Entertainment)

The effects genius said this wouldn't be an easy job, saying the creatures alone would cost the production $3m (£2.4m). When Night Skies ultimately fell apart — more on that shortly — Baker was furious and the split between him and Spielberg was anything but amicable, especially given Baker had already shelled out around $700,000 (£550,000) on the movie.

In 2014, having moved on from the row, Baker even tweeted some of his original designs, so we can see just how creepy the prototype aliens for Night Skies really were. We're a long way from E.T. when it comes to these guys.

Except, we weren't actually very far from E.T. at all. By the time he jetted off to make Raiders of the Lost Ark, Spielberg was having a lot of second thoughts about Night Skies. He wasn't sure about the darkness of the material and yearned for the quieter, thoughtful storytelling of Close Encounters. One day, he read the script to Raiders star Harrison Ford's then-girlfriend — screenwriter Melissa Mathison.

She shared many of Spielberg's concerns, but loved one aspect of the story, in which a kind member of the alien group bonded with an autistic child. Mathison and Spielberg took that germ of an idea and began to write the film that would, just a few years later, win the world's heart as E.T. the Extra-Terrestrial.

Read more: 10 extraordinary facts about E.T. the Extra-Terrestrial (BANG Showbiz)

Columbia were satiated by the release of Close Encounters of the Third Kind: The Special Edition and Universal made a deal for Night Skies — then retooled into E.T. — in which Columbia would get 5% of the film's net profit. Given that E.T. went on to make $793m (£623m) at the global box office, that ended up as a pretty tidy deal.

As for the darker edges of the story, Spielberg would take those over to MGM and switch out the aliens for ghosts. Those parts of Night Skies were eventually infused into 1982's Poltergeist, which also boasted Spielberg's choice of Night Skies director in Tobe Hooper.

Read more: Steven Spielberg Points Out Big Mistake In ‘E.T.’ That He Really Regrets (HuffPost)

There are even elements of Night Skies in the 1984 film Gremlins, executive produced by Spielberg. It contains the idea of one member of an otherwise hostile species being friendly, as well as a cinema marquee advertising a film called Watch the Skies. Everything came full circle for this one in the end.

Now, more than 40 years later, we're getting a brand new slice of Spielbergian sci-fi. Whether it will be as dark as Night Skies or as sentimental as Close Encounters, only time will tell. We're just happy that one of cinema's greatest directors is watching the skies all over again.

E.T.: The Extra-Terrestrial is streaming on NOW with a Sky Cinema Membership.