HBO produced a sequel, entitled Witch Hunt (1994), which takes place in the 1950s during the red scare (magic is substituted for communism). Dennis Hopper played Lovecraft, in place of Fred Ward. Many characters reappear from this film, though some have different backstories.
Names of the "Outsiders" are taken from the pantheon of dark "Outer" gods created and developed by horror writers H.P. Lovecraft and August Derleth, among the names: Yog Sothoth, Cthulu, and Azathoth.
Original script title was "Lovecraft" and it took more than 10 years to get made.
The Nightclub owned by Harry Bordon is called The Dunwich Room, a reference to H P Lovecraft's famous stories The Dunwich Horror and The Shuttered Room.
The book which the Lovecraft character's hired to recover - the Necronomicon, appears in many of author H.P. Lovecraft's Cthulhu Mythos stories.