Continuity mistake: When Brenda is caught wounding Natalie by Reese, she backs away. As Reese points her gun at Brenda and tells her to back up, between shots Brenda's coat keeps changing it's position on her shoulders from on or off them. (01:26:15)
Continuity mistake: In the climax of the movie, Brenda is shot out of the boarded up window. However the boards that are nailed across the window change. Firstly, there are only a few planks with many gaps. But from outside, the whole window is boarded, with NO gaps. (01:28:40)
Continuity mistake: At the end of the film, Paul went in the house when it was raining, but his coat is not wet.
Continuity mistake: When the killer has hanged Damon in the tree and smashes the front window of the car, the girl in the car is backing, and when she does that the killer falls off the car, and then you can, if you listen carefully, hear a mans voice "say" something like "uff". The killer is a girl but the stuntman is a man.
Continuity mistake: At the end when Brenda flies through the windshield, she goes into the water face down. When Natalie and Paul see her floating, she's face up.
Continuity mistake: Natalie picks up the urban legend book at the library. After she bumps into Sasha, the book is now thicker.
Continuity mistake: When the gas station attendant fills up Michelle Mancini's car, he is looking at her. The next shot shows that he's looking at her back seat.
Answer: This urban legend involves wannabe gang-bangers being required to make a kill to join the gang. In this scenario they drive with their headlights off and kill the driver of the first car that flashes their headlights at them. This was proved to be a false urban legend by snopes.com where more information can be found at http://www.snopes.com/horrors/madmen/lightsout.asp.
OneHappyHusky