The name of the diner where Alice works is called the "Crave Inn", a reference to franchise creator Wes Craven.
This was the highest-grossing entry in the "A Nightmare on Elm Street" film franchise (not counting Freddy vs. Jason (2003)). It earned $49 million in the U.S.
Renny Harlin got the director's job by refusing to take "no" for an answer. Because A Nightmare on Elm Street 3: Dream Warriors (1987) had been a big hit, a sequel was quickly greenlit for an August 1988 release, and as a huge fan of the series, Harlin relentlessly campaigned to direct it. He showed up at the New Line Cinema offices on a daily basis, repeatedly requesting to speak with producer Robert Shaye. For a variety of reasons, New Line didn't like any of the other directors who came in for meetings about this movie, and since Harlin always seemed to be around, he was finally granted an audience. However, there was little enthusiasm from the studio's side, as Shaye had little reason to put his faith in a young nobody with only two poorly received movies under his belt. Shaye, in turn, admitted that he was hesitant to offer an American horror movie to a Finnish director whose ideas were outrageous at best. Eventually, Harlin's persistence won the day, to some degree because he was so clearly impoverished that his clothes never seemed to change day-to-day, and even began to smell. Shaye half-jokingly said that they had to hire him just so he could buy some new clothes; another weird reason (by his own admission) was that with less than a year to go before the release date and a looming writers' strike, Shaye couldn't afford to waste any more time, and be believed that Harlin looked at least strong and energetic enough to see the hectic shoot through to the end. According to Harlin, Shaye rarely ever spoke to him throughout the shoot, even though he would visit the set quite often. Not only made this filming Shaye's cameo scene as a teacher a bit difficult; the resulting tension also meant that Harlin lived each day on-set like it would be his last, because he was fairly positive that Shaye was going to fire him at any moment without warning. In the end, the film was such a big hit in screenings that Shaye invited Harlin to come to the premiere with him in his limousine.