Retroactive Recognition: Late into the line's lifespan, Mattel held a contest for fans to design their own character, which they would then make into an official action figure (the plan never came through). The winner was Nathan Bitner, who grew up to design characters for the Halo series.
Saved from Development Hell: The winning character design from the contest mentioned above was never made for unknown reasons, though Mattel came through with every other promised prize. Finally the character, Fearless Photog, was made as part of the Classics line for the 30th anniversary of the franchise.
There were plans for a prequel to both MotU and She-Ra featuring an ancestor of the main characters, He-Ro. Yeah, those never saw the light of day, but He-Ro has recently been released as part of the MotU Classics toyline.
Similarly, Vikor, He-Man of the North, is a MOTU classics figure based on the earliest stage of what would become He-Man's design.
The Monogram figure kit line was almost cancelled in favor of another project (which didn't itself see the light of day): a 1/25 scale Dodge Diplomat police car.
There was to be a sequel series called He-Ro Son of He-Man, featuring He-Man's adopted son, but nothing came of it.
The original idea for Two-Bad was making one of the heads be a good guy and the other a bad guy. This was skipped and both were bad.
In the 2002 series, they were going to be part of the Evil Warriors from the beginning, until their origin story was considered for a later episode.
Contest Winner Cameo: In the DVD Commentary, Gary Goddard mentions how Mattel held a contest where the winner would get a role in the film, but they didn't tell them about this until very late in production, so the winner just got a cameo as one of Skeletor's guards near the end with his face hidden under a pig mask.
Doing It for the Art: The final sword fight between He-Man and Skeletor was filmed at the very end, after the money ran out. The director paid out of his own pocket to get that vital sequence filmed and have a finished movie, which is why the set and lighting change so dramatically just for the lions share of the duel.
Mattel refused to have any action figure based character killed in the movie. Ironically, one of the three movie characters which Mattel turned into an action figure, Saurod, gets killed early on. They also mandated early in production that He-Man not be allowed to kill anyone on screen. This necessitated making Skeletor's troops into robot soldiers, though this fact is never stated outright in the film.
Gary Goddard tried to dedicate the film to Jack Kirby in the closing credits. But the studio took the credit out.
Role Reprisal: The Mexican Spanish dub use the same voice cast from the animated TV series.
So My Kids Can Watch: Frank Langella cited his then-four-year-old son's love of Skeletor while running around his house yelling He-Man's battle cry "I have the power!", as the reason he chose to play He-Man's archenemy.
Stillborn Franchise: There were plans for a sequel, which got as far as early production. However, due to monetary issues, Cannon Films lost the rights to the franchise, and the whole project, along with the Cannon's cancelled Spider-Man production assets, eventually turned into Albert Pyun's Cyborg.
Troubled Production: The film went into production at the wrong time, as He-Man was slowly dwindling in popularity, Cannon Films was going bankrupt AND Mattel was having financial issues. It went from getting a slashed budget right before filming began to spending the entire back half of filming trying to convince the crew that paychecks will be in that day. Filming was officially shut down just before they could film the climactic sword fight and have a completed movie, the director had to wiggle in another two days of extremely calculated filming to do the bulk of the fight later that evening and then squeeze in another day a month later (on the directors dime) to get the final shots before the set was torn down. They designed the set with the intention of the final fight using all of it and were disappointed in the end result themselves.
The original idea was to have the film set on Eternia throughout and be much more faithful to the cartoon, but since the first draft the script was written to have it set on Earth and reduce the amount of sets, and strange characters they would need to create.
The original concept for Blade was to have him in heavy alien make-up, chain mail, and a black rubber body glove. However, because of the daunting action sequences, Anthony De Longis feared for his health, so the rubber was trimmed away in the areas that the chain mail would not cover to allow his skin to breathe. De Longis also did not want to wear heavy make-up, so he offered to shave his head instead.
Snake Mountain was actually going to be in the movie. A matte painting was to be done for the exterior, while the interiors, known as Skeletor's Palace, were drawn by production designer William Stout. Stout had drawn a series of byways throughout the floor plan with small rivers of lava flowing through the ground around Skeletor's throne in the throne room. The shapes for Skeletor's throne room, also called the Lava Lounge, were inspired by Frank Lloyd Wright's design of the Imperial Hotel in Japan. Plans for Snake Mountain were quickly scrapped before a set could be built to keep the film's budget low, much to the ire and disappointment of He-Man fans.
The Snakemen and She-Ra were in early drafts. William Stout was able to get Gary Goddard to approve his redesigned She-Ra costume, which was a futuristic white and gold suit consisting of a gold crown, a long sleeved top that revealed She-Ra's cleavage and midriff, a gold chain-mail skirt and knee-high boots. However, the Snakemen and She-Ra were cut out due to the film's limited budget.