Fair for Its Day: The documentary on the film's history accompanying the MST3K release reveals that this was considered a genuinely scary film when first released in theaters.
Narm: Giant, transparent skulls flying at the screen just aren't that scary. The Stinger of the MST3K episode is the scene where a skeletal Marian confronts Eric, only for the murderer to smoothly scoop up a stool and throw it at her, sending her component bones flying.
The supremely goofy score at the climax, which Mike laughingly describes as "Bugs Bunny sneaking-up music."
Padding: At least a third of the film is Jenni listening to someone knocking at the door without opening it.
They Wasted a Perfectly Good Plot: The story underlying all of the padding would actually be a pretty good psychological thriller, if it were directed competently, the actors actually acted, and the filler stripped out.
For that matter, the original F. Marion Crawford short story would make a good short film or radio drama.