Visible crew/equipment: When the boy who wanted to be a wizard is being chased in his dream, they are in a dark tight corridor, and Freddy releases a chair with spikes on it to chase after the boy, but if you look you can clearly see the chair is being pulled with strings. (01:12:50)
Continuity mistake: When Freddy and Kristen are fighting in the boiler room, there are some barrels full of bones. Later they disappear.
Other mistake: When Taryn turns into a punk and walks down the alley way, you can clearly see Freddy's back along the bottom of the camera shot as if he is trying to pass the camera for the next shot. This happens as Taryn looks down the alley. However, if that was meant to happen, wouldn't she have seen Freddy, and not have been so scared when he approached her from behind?
Plot hole: The TV-watching girl is killed when Freddy shoves her face first into a TV set. (one of the more creative movie deaths.) But the thing is, all the other deaths have been set up to look like suicides if not accidents - this one was obviously foul play, since there's no way she could have launched herself into the glass of a TV screen hard enough to break it. We see that her body is found this way, but they make no inquiry.
Continuity mistake: When Philip is sleepwalking, he walks out of the room since the door is wide open. Yet in the scene where Joey is slamming on everyone's doors to wake them up, we see that the door to Philip's room is shut because Kincaid is seen opening the door.
Continuity mistake: When Max turns off the lights, the switches are already down - he doesn't move them in any way (neither up nor down) and therefore hasn't made any actions that would alter the current lighting situation, however the lights turn themselves off anyway even though it is apparent the switches were not moved. Nobody else moved any lightswitches either. (00:25:50)
Continuity mistake: In the scene where Freddy turns into a puppet, he cuts his own strings with his knive fingers to get down and as he falls you can see some strings still attached to him, but when the shot changes and he lands on the floor, there are no longer any strings attached to him. (00:28:30)