Continuity mistake: When Reg and Mike jump out of the bedroom window to escape from the dwarfs, in a wide-shot the white window framing on the sides of the window is broken off. But in a closeup of the dwarfs looking out of the window, the white wooden framing has reappeared on the sides of the window.
Visible crew/equipment: Crew and cameras can be seen reflected in the silver sphere numerous times, especially as the sphere is embedded in the crematory henchman's hand and back. My personal favourite is when the silver sphere flies into the Tall Man's head, in a frontal shot you can see two crewmembers standing by a large grey camera, reflected in the silver ball.
Continuity mistake: In the film the Tall man pulls right up front to Mike's house and opens the back of the hearse and pulls out a coffin. The hearse is parked in front of Mike's house on the road. As the house explodes, the scene then cuts to a wide shot of the house exploding (still shot from the front of the house) and the hearse isn't anywhere on the street. It finally goes back to the Tall man walking to the hearse and pushing the coffin back into the hearse.
Continuity mistake: When Reg hears Mike in trouble upstairs, he puts down his guitar and runs upstairs. The rocking chair which was next to Reg has now gone in this shot, the rack of utensils by the fireplace (poker, shovel etc.) has switched which side of the fireplace it is on, and the logs by the fireplace have changed completely.
Continuity mistake: Near the end of the movie, Mike gets sucked into the Phantasm dimension, followed shortly by Reg because he grabs hold of Mike to save him. Reg is left struggling to pull him out, with his feet stopping him from flying into the dimension because they are caught on one of the silver poles. However in a following shot, as the Tall Man carries Liz into the other room, in the background you can see the poles, and Reg's feet are missing from being caught on it. In the next shot we see Reg's feet still caught on the pole, saving him from entering the dimension.
Continuity mistake: When the priest is sitting in his home looking very nervous he pours himself a drink, takes a sip, then starts hearing scratching noises at the door, and the next shot shows that this door is locked with a chain lock. He then says, "Bless me mother," gets up and slowly approaches the door, but it is now shown unlocked, before he locks the door with the chain lock.
Continuity mistake: Reggie and Mike are sitting by the fireplace downstairs and they decide to get out of town. Next to Reggie is a coffee mug resting on the stone ledge of the fireplace. Mike goes upstairs and is pulled through a mirror. Reggie hears the glass breaking and runs upstairs, and now the coffee mug is gone. Reggie then runs back downstairs to grab a shotgun and now his coffee mug has reappeared but is now on opposite side of the fireplace.