Los Angeles  - A low-budget horror film that's the rage at box offices is teaching Hollywood's highly paid actors, producers and other film pros that mega-budget blockbusters are not the only way to connect with audiences.

In an age when the average Hollywood production is well north of 100 million dollars, Paranormal Activity was filmed by first-time director Oren Peli in his own house for under 15,000 dollars. That's less than many producers spend on their weekly champagne budget.

But the movie still brought in almost 8 million dollars over the weekend, when it played in just 159 cinemas, and millions more in ticket sales are sure to follow when the film goes into wide release.

Much of its success has been credited to an innovative marketing campaign by Paramount, which used popular websites like Facebook and Twitter to build strong word-of-mouth recommendations. But the movie has also been highly acclaimed by no less than Steven Spielberg, who nabbed the rights to the movie before his Dreamworks Studio split from Paramount.

The movie is of the "found-footage" genre, pioneered years ago in The Blair Witch Project, and purports to be made up entirely of amateur video footage taken by a young suburban couple, who place a camera in their bedroom to try to find out the cause of all those strange noises they were hearing in the night.

Unlike most horror movies, there is no gore and almost no blood.

As the Israeli-born Peli puts it: "Nothing you could ever show, with props or CGI, is ever going to be as a scary as your imagination. There's just this invisible force. It could be right next to you."

Peli has no formal film training but was a video-game designer, and his experience in creating a narrative in the relatively low- graphic mode of early video games allows him to manipulate audiences with little more than a flickering shadow or slowly moving door.

Spielberg, who in movies like Poltergeist and Jaws showed his own spine-tingling skill, paid tribute to Peli's vision, telling USA Today that he was so scared he had to stop watching the movie the first night he saw it, and finish it during daylight hours.

"What Oren does so brilliantly - and sadistically - to audiences with this film is its accumulation of small events," Spielberg said.

"That creates a slow burn, so that when something occurs that is shocking, it multiplies the impact on the audience. He doesn't rush the scares and really takes his time with it. That's the magical elixir that makes this film so frightening."

Paramount decided to maximize that effect by first releasing the movie only for midnight screenings in a handful of college towns. As word spread over the internet, the studio set up an online petition for would-be ticket buyers to request screenings in their towns, which led to a rollout last weekend in 40 cities.

Paramount promised that it would release the film nationwide when 1 million people signed up, a milestone that was reached Saturday.

So far, audiences have shrieked and laughed, clapped and cowered, screamed and cursed throughout the movie, as the San Diego couple try to deal with the hostile presence in their bedroom. As the website DreadCentral. com noted: "The entire audience was freaked out of their mind."

Hollywood has certainly taken notice of the rave reactions.

Paramount has given Peli a 5-million-dollar budget for his next movie, Area 51. This will also feature a "found footage" narrative structure that tells the story of three teens whose curiosity leads them to the notorious Area 51 on Nellis Air Force Base in the Nevada desert, which is often said to house evidence of aliens.

Peli's fans will be hoping that that the money doesn't spoil him.

"It's amazing what he did in Paranormal Activity," UCLA film student Max Henderson said. "I know it was only fiction, but I was scared for days afterwards." (dpa)