My recent Profile of Guillermo del Toro chronicled his efforts to realize his dream project: a hundred-and-fifty-million-dollar adaptation of “At the Mountains of Madness,” the H. P. Lovecraft novella about scientists who come across malignant, mutating aliens during an expedition to Antarctica. After three months of deliberation, Universal Pictures, the studio that gave del Toro money for pre-production creature designs, has remained unwilling to give the director a greenlight, citing concerns over the film’s budget and likely R rating. On Monday, del Toro withdrew from the negotiations, and that night at ten-thirty he sent me a short, mournful e-mail:

Madness has gone dark. The ‘R’ did us in.

Del Toro had told me that he would not compromise on the film’s rating, even though a film rated PG-13 would have a much easier time attracting a mass audience. “Madness,” as he imagined it, would not be particularly gory, but he insisted that he needed the artistic freedom “to make it really, really uncomfortable and nasty.” Del Toro had hoped that a greenlight for “Madness” would mark a new golden age for horror films:

Del Toro envisaged “Madness” as a “hard R” epic, shot in 3-D, with a blockbuster budget. Creating dozens of morphing creatures would be expensive, and much of the film needed to be shot somewhere that approximated Antarctica; one of the most disquieting aspects of Lovecraft’s novella is that the explorers are being pursued by monsters in a vast frozen void, and del Toro wanted to make the first horror movie on the scale of a David Lean production. But a “tent-pole horror film,” as del Toro put it, hadn’t been made in years. High-budget productions such as “Alien” and “The Shining” had been followed by decades of cheaper thrills. “The natural flaw of horror as a genre is that, ninety-nine per cent of the time, it’s a clandestine genre,” he said. “It lives and breathes—‘Texas Chainsaw Massacre,’ the first ‘Saw,’ ‘The Blair Witch Project’—in dark little corners that come out and haunt you. Rarely is there a beautiful orchid that blooms.” He mentioned Hitchcock’s “The Birds”: “It was a major filmmaker using cutting-edge optical technology and special effects. It was a big-budget movie. It had Edith Head designing costumes, it had all the luxuries. And it was appealing because it had all the polished aspects of a studio film.”

According to Deadline.com, Universal executives felt that “Madness” would need to make at least five hundred million dollars in worldwide grosses in order to turn a profit, considering global marketing costs. It is possible that del Toro will now present the project to another studio.

Adam Fogelson, the chairman of Universal Pictures, had seemed excited about “Madness” when I talked to him in January. He spoke of being dazzled when del Toro made a visual presentation of his plans for the film, at a meeting attended by James Cameron, the director of “Avatar,” who had agreed to serve as a producer. Fogelson said, “Boy, I wish I was capable of succinctly summarizing what it is to be in a room with Guillermo, and James Cameron and his team, presenting on a project that is such a passion project for Guillermo.” He called del Toro’s presentation “one of the more extraordinary and gratifying professional experiences I have had.” Fogelson went on, “The kind of movie Guillermo is looking to create is not something there’s been much of in the recent past. But I think anyone working in this business right now would acknowledge that attempting to follow a prescribed formula is not less scary than talking a walk across a virgin landscape. There are no sure things. There are no—or very few—easy, obvious safe bets. And what we’re looking to do here is, we want to make great films. We think great films make great business.”

Photograph: Josef Astor.