Alone in the Dark, Shadow of the Comet, Prisoner of Ice - games based on or inspired by works by H.P. Lovecraft. None of these can claim to be the best or first game of this theme though, because there is another one which is both older and still beats them all easily: The Hound of Shadow!
First of all, I should warn all younger readers: this is a text-adventure with 'only' a few still shots of some sceneries in addition to the text descriptions! If you're prejudiced against this type of game, you can stop reading now, but you'll miss a great game! A great game of a very rare type: a horror game. Not of the 'modern' kind with splurting blood galore, but with creeping suspense. Just the way I like it.
The story evolves around the main character who lives in London in the 1920s. He/she attends a seance with his/her friend where something strange happens. Soon, he/she finds him/herself being forced to face the occult, to confront magical, evil beings and to deal with a curse.
The Hound of Shadow was the first game to use an role-playing system (don't get put off by the term, the game is a classic Adventure, not an RPG) called 'Timeline' which has its strongest point in the character generation. At the beginning of the game, you can create your alter ego in a very detailed way. Timeline doesn't use the normal RPG-attributes, but they're fit into the needs of the game, so you can choose between the profession of a private detective, an aristocrat and a professor, between the abilities of speaking languages, bluffing, knowledge of the occult, fencing and so on.
These values later influence the course of the game. Characters who are fluent in ancient Greek and German will for example be able to understand many of the occult texts from the library themselves while others will need help there. Occultists can understand cryptic signs on walls and get hints that way.
Unfortunately, most abilities you have thought about so much at the beginning of the game will later be completely useless! The Timeline engine was apparantely created to be applicable to many different games, so you can ponder about whether to be a pilot or good at fencing as long as you want - it won't have any effect in this game. In fact, too few abilities do have an effect and these effects are also too small if you ask me! There could have been completely different ways to solve the game based on the main character, but there aren't. A lot is left to the player's imagination here.
The game lives from its rich and moody writing. The descriptions of what's happening and the actions are very detailed and the 'sources' (books) you consult later in the game are written in a believable and fitting way. Only the room descriptions are lacking sometimes, especially concerning the game mechanics (missing directions).
The good writing is perfectly supported by the great graphics. For the important settings, there are full-screen pictures which really catch the whole athmosphere of the game with their perfect colouring and excellent style!
Another positive aspect is the open game design. Even though you mostly know what to achieve next, you always have 'free time' to walk around randomly, explore London by foot, by bus or by subway, take a stroll down Oxford Street, visit a pub or a night club, go to the cinema - whatever you can think of. Or rather what the programmers thought of, but that is really a lot, so you certainly won't get bored even not following the storyline
Overall, The Hound of Shadow is a masterpiece of interactive fiction. There aren't that many object-based puzzles to think over, you're just required to grasp the storyline and get involved in it, take action is logical ways. The details are mostly not so important. That way, the flow of the storytelling isn't interrupted too much, but you still have a challenge ahead of you.
The only slightly disappointing aspect is the lack of further integration of the character abilities into the game. I would have loved to see more games based on this system, but maybe this one just wasn't successful enough. There is just one more Adventure by the same team: Daughter of Serpents. There we can find the character creation again, but no visible connection (like the option to import characters). And worst of all: after being in development for many years, the Amiga version of this sequel was never published