"Dagon" is based on the short story 'The Shadow Over Innsmouth'
Two young American tourists, Barbara and Paul, seek help in a small town called Imboca on the coast of Galicia in Spain after their boat becomes shipwrecked and Howard and Vicki, their friends, are trapped. However, the inhabitants turn out to be far from friendly, and, as they discover, not even human, apart from a drunken tramp named Ezequiel. This latter (played by veteran Spanish actor Francisco Rabal in what would be his last role), tells Paul how the denizens of the town have overthrown Christianity in favour of the fish god Dagon, who has brought them wealth from the sea in the form of fish and gold. Since that time, they have mutated into fish-like forms and are obedient to the beautiful, mermaid-like Uxía. Eerily, she has appeared to Paul in his dreams even before they met, and she saves him from being murdered by the locals. However, her plans for him, and for Barbara, unleash horror beyond all imagination.
While running for his life, Paul is captured and reunited with Barbara, Ezequiel, and Vicki, who survived the shipwreck. Howard was killed by the locals. Vicki kills herself after learning that she is pregnant with Dagon's offspring. The townsfolk capture the remaining three. Ezequiel has his face flayed and Paul is about to be next until Uxía orders his release, telling him Barbara's sacrifice to Dagon will produce a child that will be immortal. After Paul kills Ezequiel's murderers, he makes his way to the church and finds a secret passage that leads to the catacombs. As Paul make his way through, Barbara's skin is slowly slashed by Uxía, who offers her as a sacrifice to Dagon. Uxía watches while the whole town lowers Barbara down to her doom in a pit. Paul arrives, killing some of the chanting inhabitants, and reaches Barbara, but tentacles rise out of the pit, wrapping around Barbara and dragging her down.
Paul is then attacked by the Imbocans; however, Uxía saves him again, revealing that everyone in Imboca had different mothers, but the same father: Dagon. Uxía reveals she and Paul, despite being siblings, are to be together for eternity. Seeing no way out, Paul sets himself on fire in despair, but Uxía drags him into the water, where he develops gills. The ending shows the both of them swimming toward a huge hole made of stones covered with gold symbols; a destination Paul had seen in his dreams.
An enjoyable and reasonaly faithful adaptation of 'The Shadow over Innsmouth' though the climactic scenes are a little overreliant on CGI.
- The ending dialogue reads, "We shall dive down through black abysses, and in that lair of the Deep Ones, we shall dwell amidst wonder and glory for ever." This is the final line of Lovecraft's famous novel The Shadow over Innsmouth, where the main character accepts his Deep One heritage and anticipates his eventual homecoming in his grandmother's city of Y'ha-nthlei.
- The main character Paul is shown wearing a Miskatonic University shirt.
- "Iä! Iä! Cthulhu fhtagn!" is heard during the cultists ceremony.
- The name of the town in the film is ' Inboca' which means 'Mouth' which is a reference to 'Innsmouth'.