On holiday in Egypt with George and Emily Hacker (Christopher Connelly and Martha Taylor), her archaeologist father and journalist mother, ten-year-old Susie Hacker (Brigitta Boccoli) is approached by a mysterious blind woman who gives her an amulet. Soon after, George is struck blind when he enters a previously unexplored tomb.
Upon their return in New York City, George is informed that the loss of his eyesight will only be temporary. Susie begins to act strangely, and her younger brother Tommy (Giovanni Frezza), who stayed behind in New York with the family's au pair Jamie Lee (Cinzia de Ponti), is also affected by the mysterious amulet. Both Susie and Tommy have gained supernatural access to dimensional doorways. A few days later, George's eyesight returns, and he describes the design on the wall of the tomb he'd entered to a colleague called Wiler.
Luke Anderson (Carlo De Mejo), an eccentric colleague of Emily's, is working with her on her latest story detailing her travels in Egypt. When Jamie Lee panics when she cannot unlock the children's bedroom door, she calls Emily at work. Emily asks Luke to come with her. When Luke volunteers to unlock the door, he is sucked into the dimensional portal and finds himself transported to the deserts of Egypt where he later dies from dehydration in the vast, arid desert. The Hackers think Luke's disappearance is merely a practical joke, but they never learn of his fate, nor find any trace of him.
Jamie Lee takes the kids out to nearby Central Park to play where she takes photos of them. A woman picks up a discarded Polaroid photo taken of Susie that hadn't developed earlier. It shows nothing but the amulet against the grassy background. The woman contacts a man called Adrian Marcato (Laurence Welles) with her find. The next day, the woman drops the Polaroid down to Mrs. Hacker from a window overlooking the pavement. Marcato's name and phone number are written on it.
Meanwhile, Susie and Tommy continue to appear and disappear from their bedrooms on what Tommy calls "voyages". Soon, Jamie Lee herself disappears after entering Tommy's room. When Emily asks Tommy if he saw Jamie Lee recently, he tells his mother that Jamie Lee has not come back from her own voyage. That evening, George's colleague Wiler is fatally bitten by a cobra that magically appears in his office as he is looking over the photo of the amulet that Hackers have given him. The photo magically disappears and reappears in Susie's hand as she recovers from a mysterious fit.
George and Emily track down Marcato to his antique shop. He tells them about the evil symbolism of the amulet, and suggests that Susie has absorbed its energy. When George and Emily find the amulet in Susie's bedroom drawer, she appears to them glowing with an unearthly blue light, and then faints. Marcato is called to the Hackers apartment to examine Susie, but is possessed by her inner voice crying for help, and falls to the ground, bleeding and foaming at the mouth. Marcato regains consciousness and succeeds in linking minds briefly with George, showing him a glimpse into the eldritch Egypt his children have been visiting. Susie is then taken to a nearby hospital where the physician Dr. Forrester (Lucio Fulci) examines her, baffled by her illness. An X-ray taken shows the dark shape of a hooded cobra mark in her chest.
While Emily maintains a bedside vigil for the near-comatose Susie, Tommy is alone in the apartment. Suddenly, Jamie Lee turns up, bursting through a wall as a reanimated rotting cadaver before she drops dead. A strange blue light of negative energy is shown flowing from Tommy, the bed-ridden Susie, and the dimensional doorways and channeled into Marcato's home where he is reciting an ancient Egyptian spell. George goes to see Marcato again, who tells him that he can stop worrying about his children. With the spell, Marcato has channeled the evil energy away from George's children and the curse is now on him. Marcato gives George the amulet and tells him to discard it so the curse will not affect anyone else. That night, Marcato is killed at his shop when the re-animated carcasses of his stuffed birds come to life and tear him to pieces. At the hospital, a healed Susie wakes up with her mother by her bedside. The following morning, George, following Marcato's last suggestion, flings the amulet into the East River, bringing an end to their ordeal.
In the final scene back in Egypt, the mystical blind woman once again appears and gives the same amulet to another young girl, intending to continue the curse for the forces of darkness, bringing it full circle.Christopher Connelly as Professor George Hacker
Laura Lenzi as Emily Hacker (credited as Martha Taylor)
Giovanni Frezza as Tommy Hacker
Brigitta Boccoli as Susie Hacker
Cinzia De Ponti as Jamie Lee
Cosimo Cinieri as Adrian Mercato (credited as Laurence Welles)
Andrea Bosic as Optician
Carlo De Mejo as Luke
Anonymous as Dr. Aziz
Dardano Sacchetti collaborated with his wife Elisa Briganti on a script originally titled Il malocchio (lit. The Evil Eye). The films title was later changed to Manhattan Baby which was an attempt to evoke Rosemary's Baby. Sacchetti spoke on his script, describing it as "an attempt to do a technological piece. I was attempting to approach themes that were no longer classic or traditionally Gothic. I was trying to bring horror in a different direction." Sacchetti and Briganti were not pleased with the films finished product, with Sacchetti stating that "when the producers decided to cut three-quarters of the budget, some of the special effects could not be realised, and the film was ultimately very poor." Sacchetti says the extended opening scene in Egypt was added as an afterthought to "give the film an international feel."
The film would end the partnership between Lucio Fulci and producer Fabrizio De Angelis. Fulci disliked the film himself saying he had no choice in making the film as De Angelis was obsessed with it. Fulci commented that it was "a terrible movie; I'd venture to describe it as one of those setbacks that occur as you go along"
Manhattan Baby was released in Italy on August 12, 1982. The title Manhattan Baby is an alternative title on the films Italian release. It was titled The Possessed and Eye of the Evil Dead in the United Kingdom and the United States respectively.
From contemporary reviews, Kim Newman (Monthly Film Bulletin) described the film as Fulci's "smallest, most personal genre film." Newman commented on the films focus on eyes, stating that "some of the effect is lost on video, this wide-screen dwelling on a single infinitely variable image turns the film into an almost hypnotic screen experience. It is also woodenly scripted, stiffly acted, funereally paced and impossible to follow on any narrative level." Newman concluded that the film "absolves itself from having to make sense: the rough circularity of the story, the insistence on mosaic images rather than smooth plotting, and the impossibility of attributing noble or heroic motives to the character of Marcato, finally serve to remind us that the supernatural is also the irrational."
From retrospective reviews, AllMovie panned the film, finding it to be one of Fulci's worst films. The review went on to critique the continuous presence of eyes in the film, declaring it to be " a pointless and stupid film of no possible interest to anyone except demented opticians." Louis Paul, author of the book Italian Horror Film Directors, opined that "although it contains some graphic murders, ultimately L'Occhio del Mal is a decidedly lifeless affair."