The film's production was turbulent due to artistic differences between producer Hal E. Chester on one side and Tourneur and writer Charles Bennett on the other. Although the original plan was not to show a literal demon, producer Chester inserted a monster over the objections of the writer, the director, and lead actor Dana Andrews. To accelerate the pace, the film was trimmed down to 83 minutes (and retitled Curse of the Demon) in the US, where it played the second half of a double bill variously with The True Story of Lynn Stuart and The Revenge of Frankenstein (1958).
In England, Professor Harrington (Maurice Denham) visits his rival, Dr. Julian Karswell (Niall MacGinnis). Harrington promises to cancel an investigation of Karswell's involvement in Satanism if Karswell will rescind a threat he has made against Harrington who had threatened to expose Karswell as a fraud. After learning that a parchment given to Harrington has disintegrated, flying from his fingers into the fire as if it had a life of its own, Karswell glances at the clock and ushers Harrington out, promising to do all that he can. As Harrington arrives home relieved, a gigantic demon materializes and pursues him. Losing control of the car, Harrington crashes into an electrical pole and is electrocuted yet when his body is found it has been torn to pieces.
Dr. John Holden (Dana Andrews), a man obstinately opposed to any thought of the supernatural, arrives in England to attend a convention at which Harrington had intended to expose Karswell's cult. Holden is informed of Harrington's death and that the only link between it and Karswell's cult is an accused murderer, Rand Hobart (Brian Wilde), who has fallen into a catatonic stupor. While Harrington's collaborators consider the possibility of supernatural forces, Holden rejects the idea as superstition.
Following Harrington's notes, Holden visits the British Museum Reading Room to examine books on witchcraft. A book Holden requests is discovered to be missing. Karswell offers to show Holden his own copy at his mansion; while making this offer Karswell knocks Holden's file folder to the floor, but politely picks it up and returns it to him. At Harrington's funeral, Holden meets the dead man's niece, Joanna (Peggy Cummins), who gives him Harrington's diary. It reveals Harrington's increasing fear of Karswell's power. Holden remains sceptical, but goes with Joanna to Karswell's mansion the next day.
There, Holden and Karswell mock each other's beliefs. A very strong windstorm abruptly starts, which Karswell claims to have created with a spell. When Holden continues to mock him, Karswell grows angry and predicts that Holden will die in three days.
Holden and his colleagues discuss Karswell and make plans to further examine Rand Hobart. Harrington's diary mentions the parchment passed to him by Karswell; Holden finds a parchment with runic inscriptions that Karswell secretly passed to him at the library. Powerful winds come through the window, blowing the parchment from his fingers. It nearly burns in the fireplace, but is stopped by a fireplace screen before Holden, at the frantic urging of Joanna, reluctantly rescues and pockets it.
Holden begins to feel more uneasy after a visit to Hobart's family who are all obviously involved in the cult. As Holden leaves, the parchment flies from his hand again. Hobart's family become fearful and declare Holden to be "chosen". Holden compares the parchment's runes to ones inscribed on the nearby stone circle at Stonehenge.
Joanna takes Holden to Karswell's mother (Athene Seyler), who has arranged a séance. The medium channels Harrington, who tells them that Karswell has the key to reading the runes in his book. That night, Holden breaks into Karswell's mansion to examine the book. He is caught first by Karswell's demon cat and then by Karswell, but is permitted to leave. Against Karwell's warning, Holden leaves through the woods and is chased by a ball of smoke and fire. On exiting the forest, Holden finds that the phenomenon has vanished. He reports the event to the police, but feels embarrassed.
Mrs. Karswell telephones Joanna, imploring her to tell Holden that Rand Hobart knows the secret of the parchment. While Holden prepares an experiment to break Hobart's stupor, Karswell kidnaps Joanna from her car to prevent her from giving Holden the message.
Under hypnosis, Hobart reveals that he was "chosen" to die by having a parchment with a curse passed to him, but avoided death by passing it back to his own brother, who had originally passed it to Hobart under orders. When Holden shows Hobart the parchment he received from Karswell, Hobart goes berserk and throws himself from a window to his death, for fear that the parchment will be passed to him.
Informed that Karswell is leaving London by train, Holden races to catch it. He finds Karswell with Joanna. Karswell avoids any contact with Holden to guard against the parchment being passed back to him and grows increasingly fearful as time for the attack draws near. When the train stops at the next station, Karswell tries to leave, but while distracted by the police who wish to question him, Holden manages to sneak the parchment into his coat pocket which is lying unattended. Karswell instantly becomes frightened when he realizes this, and finds the parchment, which almost instantly flies from his hands. He chases it down the tracks in the hope of having time to pass it to someone else before the deadline; however, the deadline expires and the parchment combusts as he finally reaches it. As an oncoming train approaches, a thirty-foot demon appears above it, seizes Karswell, lifts him in one hand while it slashes him with the other, and finally tosses his body next to the tracks. The station crew find his mangled, steaming corpse and believe that he was struck and dragged by the train, owing to the mutilation of the body. Holden—frightened, but still obstinate—and Joanna refuse to look because "it's better not to know".Dana Andrews as Dr. John Holden
Peggy Cummins as Joanna Harrington
Niall MacGinnis as Dr. Julian Karswell
Athene Seyler as Mrs. Karswell
Liam Redmond as Professor Mark O'Brien
Peter Elliott as Professor Kumar
Maurice Denham as Professor Harrington
Screenwriter Charles Bennett owned the rights to the original story "Casting the Runes" and wrote a script loosely based on it, using the title The Haunted. He sold the script to independent producer and former child actor Hal E. Chester shortly before going to America. Bennett regretted selling the script, because on arrival in America he was approached by RKO who wanted to purchase his script and allow him to direct the film. Actors Robert Taylor and Dick Powell had been in line for the leading roles if this production had taken place.
Jacques Tourneur was brought in by Chester on the recommendation of Ted Richmond, the producer of Tourneur's previous film, Nightfall (1957). However, Tourneur and Chester had serious disagreements during filming. One argument was about the wind scene; Tourneur tried to convince Chester to replace two electric fans with two aeroplane engines. When Chester hesitated, star Dana Andrews threatened to leave the picture if Chester did not let "the director direct the picture". Locations for the film include Brocket Hall, Hertfordshire (as Lufford Hall), Stonehenge, Bricket Wood railway station, and the British Museum Reading Room.
After completion of the principal shooting, producer Chester decided to show the demon at the beginning and end of the film. Tourneur later said that he was against the addition, stating "The scenes where you see the demon were shot without me...the audience should never have been completely certain of having seen the demon." Stop motion master Ray Harryhausen was requested by Columbia Pictures to create the demon for the production, but was already committed to The 7th Voyage of Sinbad with producer Charles H. Schneer. Author Tony Earnshaw's book Beating the Devil: The Making of Night of the Demon argues that showing the demon was planned early on in the production (despite Tourneur's protests to the contrary), in order to heighten the tension in the film by letting the audience know the demonic powers were real. Bennett, also angry at the script changes, said "If [Chester] walked up my driveway right now, I'd shoot him dead."
The film was released in the United Kingdom for a theatrical run in December 1957; running to its original 96-minute length, it was shown as a double bill with the American film 20 Million Miles to Earth. In the United States, it was released as Curse of the Demon. According to Charles Bennett, the title was changed because the studio didn't want it confused with the similarly titled The Night of the Iguana. Columbia cut the film down to 81 minutes for the US release. The scenes removed included a visit to the Hobart family farm, a trip to Stonehenge, and snippets of the séance scenes and conversations between Karswell and his mother. Curse of the Demon toured drive-ins and theatres variously with The True Story of Lynn Stuart and The Revenge of Frankenstein.
In the United States, the film was released on VHS in 1986 by Columbia TriStar Home Video with a run time of 81 minutes. A second VHS with a 96-minute running time was released by Goodtimes Home Video Corp in 1988. In 1988, a Laserdisc of the film was released by Image Entertainment/Columbia Pictures with an 81-minute running time. A version including both the UK version of Night of the Demon and the edited US version as Curse of the Demon was released on DVD in August 2002. In the United Kingdom, Night of the Demon was released on VHS in 1995 by Encore Entertainment/Columbia TriStar Home Video. The film was released on DVD in the United Kingdom for the first time on 18 October 2010. This release also includes both the UK and US versions of the film.
In a contemporary review, the Monthly Film Bulletin commented that Tourneur's direction was "handled with much of the assurance the same director brought to Cat People" and that the film was "way above average". The review commented on the image of the demon, stating whenever the demon takes on a visible form, "especially the ending", it seemed more like a product of "a child's nightmare than an adult's imagination".
In the early 2010s, Time Out conducted a poll with several authors, directors, actors and critics who have worked within the horror genre to vote for their top horror films. Night of the Demon placed at number 52 on their top 100 list."Science Fiction/Double Feature", the opening song from the musical The Rocky Horror Show (1973) and its film adaptation The Rocky Horror Picture Show (1975), includes the line, "Dana Andrews said prunes gave him the runes/And passing them uses lots of skill."
The Kate Bush song "Hounds of Love" (1985) begins with a sample from the film, the line "It's in the trees, it's coming!"
The intro of the song "Black Easter" on the Sol Invictus album Lex Talionis (1989) consists of a dialogue between Dr. Julian Karswell and Dr. John Holden.
Lustmord's song "Ixaxaar", from the album The Monstrous Soul (1992), includes a looped sample of the line "It is the night of the demon".
Coil's Queens of the Circulating Library (2000) also features the line "It's in the trees, it's coming!", sung by Thighpaulsandra's mother.
Director Martin Scorsese placed Night of the Demon on his list of the 11 scariest horror films of all time.
"Prey", a 2016 episode of the Inspector Morse series Endeavour features a hunt for a suspected tiger, using the lines, "It's in the trees", "It's coming!"