The nightmare sequence right at the beginning. Some people, such as Brad from 4pp, refused to play the game after the nightmare.
It doesn't get any better with later nightmare sequences, either. Especially the one where the Facehead from the first nightmare reappears, as well as the final ones.
The pedophile in the apartments of the first chapter. He was not content with raping children and killing them, but also found a liking to eating them. He even rendered the building´s elevator non-functional, so that the kids would have to take the stairs, where he would be waiting, and pull them into his apartment.
Once the player explores his apartment he discovers a room full of photographs of the victims killed, slaughtered in different ways on all the rooms walls. Then the player gets locked in and the lights go out...
The Sawrunner. He can almost not be killed and chases you at a insanely fast speed. If that isn't enough he moves in a freakish way and has a terrible scream which will send a shiver down your spine. You'll be paranoid for the rest of the game, as he likes to suddenly appear and cause a chase sequence.
Migitated by the fact that, at least on Easy and Medium difficulties, you don't even have to sprint to avoid his One-Hit Kill attacks; he pauses each time he does a swing, allowing you to slog along at the normal pace as long as you don't stop at all. On Difficult and Nightmare, however...
"Watch out for the trees". Yes, you better do.
Since basic enemies can sneak up on the player without making a sound, jumpscares are abundant.
The school. Initially, it is well lit and abandoned, lulling the player into a false sense of monster-free security. However, the shit hits the fan when you tinker with a fuse box in one of the rooms, with bloody monsters around every corner in the now darkened halls. The worse part: the school is like a maze in the dark, with desks cluttering the floor and multiple classrooms you can access.
The music takes it up a notch during this segment by being a frantic, distorted nightmare with voices of children in the background screaming. It only stops once you manage unlock the fire exit.
An emeciated women in a white dress is strung up like a scarecrow. It slowly inches along, but can force your character to commit suicide at the sight of it. If you're cocky and decide to knife it, a baby bursts from her stomach and assaults you with its knife.
In the subway you delve into one of the most creepy nightmares of all, where Simon has to leap to and fro from bloodied platforms, deal with the floor defying gravity and other bits of lovely stuff. Then you have to figure out a puzzle by going through doors in padded rooms and then you have to traverse a maze with twitching head monsters strung up by their feet chasing you and seemingly appearing around every corner. The fact that the maze gets very dark in some places and all you can hear is the mechanical clinking of the hanging men is extremely unnerving.
Another moment that catches new players unaware is when after you retrieve the fuse from Harbor College, you have to backtrack through the courtyards and back alleys where the Sawrunner chased you. While the idea of doing so in itself is terrifying, as it requires you to lift the gate that separated you two just a moment ago, you have no choice. You pull the lever, peek your head out. Not a sound. And then you step further and you hear the revving of a chainsaw in the distance..