Ten days after her funeral, Alice's family begins hearing noises in their home, and her older brother Mathew finds numerous unexplained bruises on his body.

Her mother June consults self-proclaimed psychic Ray Kemeney for insight on the apparent haunting, and he holds a séance with the family but is unable to explain the sightings.

Months later, Mathew confesses that he faked the ghostly photos and videos of Alice as he wanted the family to have a reason to exhume her body and give closure to June, who regrets refusing to see it before the funeral.

Ray admits that Alice had met with him several months before her death to tell him that she was experiencing recurring dreams about drowning, being dead and her mother being unable to see or help her, which she also noted in a private journal.

Footage on the phone shows Alice walking along the shore and encountering a corpse-like version of herself with a bloated and disfigured face, appearing exactly as her body would later be found in the lake.

Initial financing was attained through private investors, after which the production team approached the Australian government's film funding body Screen Australia for the rest of the budget.

[13] Russell Edwards of Variety called it an "ambitious, restrained, and well-mounted mockumentary" and praised its musical score, but critiqued its dim lighting and lack of scripted dialogue.

[17] Megan Lehmann of The Hollywood Reporter noted the film's "compelling slow build", "surreal atmospherics", and "restrained soundtrack that works on a primal level [and] cleaves close to reality".

She also praised its fusion of supernatural elements with substantive themes on family and loss, concluding that "this ambitious exploration of death and its aftershocks will reward more discerning genre fans".

[18] Conversely, a review published by Bloody Disgusting concluded that "the ultimate problem with Lake Mungo is that the filmmakers had too many good ideas crammed into one film and not enough time to tell all their tales".

"[22] Following the release of Lake Mungo, Anderson has kept an extremely low profile; he has not written or directed another film, given no interviews since 2009, and has no known social media pages.