The plotline sees aliens invade the fictional New Zealand village of Kaihoro to harvest humans for their intergalactic fast food franchise, where they face off against a four-man paramilitary force.

They find the town overrun by man-eating space aliens disguised as humans in blue shirts.

After Derek notifies Frank and Ozzy, he begins torturing Robert, an alien they caught earlier.

Derek kills the would-be rescuers, but he is attacked by Robert and falls off a cliff ledge, to his presumed death.

That night, Frank, Ozzy, and Barry infiltrate the aliens' house and find a room filled with bloody cardboard boxes, likely containing the corpses of former Kaihoro residents.

After they escape the house, Lord Crumb shoots Ozzy in the leg and Frank fires his rocket launcher at the leader, but misses.

Much of the film was shot in and around Jackson's home suburb of Pukerua Bay in northern Wellington, using a 25-year-old 16mm Bolex camera.

[4] Originally begun as a 20-minute short film called Roast of the Day,[5]Bad Taste was shot primarily on weekends over the course of four years, at an initial cost of around $25,000.

In one early scene halfway down a cliff, careful editing, utilising shots taken months apart, makes it possible for the two characters, Derek and the alien Robert (both played by Jackson), to fight one another.

[4] Kaihoro, the name of the town whose inhabitants are butchered, is a Māori word coined by Jackson and his crew early in the shooting of the film.

The sheep in the film was to have played a larger role as a running gag, being surprisingly aggressive and chasing "The Boys" at various points throughout.

Kim Newman of Empire gave the film three stars out of five, with praise being directed to the special effects.

[7] For AllMovie, Jason Buchanan wrote that Bad Taste was "amazingly resourceful," but that it moves at such a "hyperactive" pace that "it's nearly impossible to draw a breath, much less take a moment to laugh at the revoltingly hilarious exploits.

The site's consensus reads: "Peter Jackson's early low-budget shocker boasts a disgusting premise—aliens harvesting humans for fast food—that gives the budding auteur plenty of room for gross-out visuals and absurd cleverness.

[14] In December 2018, Peter Jackson announced that he plans to restore Bad Taste, along with his two following films Meet the Feebles and Braindead (known as Dead Alive in North America) for a possible 4K release.

"[16] In 2008, Empire ranked Bad Taste as the 416th greatest film of all time, based on opinions from readers and industry professionals.