[5] The studio has been nicknamed "The House that Freddy Built" due to the success of the Nightmare on Elm Street film series.

In 1976, New Line Cinema secured funding to produce its first full-length feature, Stunts (1977), directed by Mark L. Lester.

[8] In 1980, Shaye's law school classmate Michael Lynne became outside counsel and adviser to the company and renegotiated its debt.

The resulting franchise was New Line Cinema's first commercially successful series, leading the company to be nicknamed "The House that Freddy Built".

[7] The same year, New Line Cinema released Teenage Mutant Ninja Turtles which became the highest-grossing independent film of all-time with a gross of $135 million in the United States and Canada, until it was surpassed by The Blair Witch Project (1999).

[20][21][22] It was followed by a sequel, Teenage Mutant Ninja Turtles II: The Secret of the Ooze (1991) which was the second highest-grossing[23] with a gross of $78 million in the United States and Canada.

In November 1990, New Line Cinema purchased a 52% stake in the television production company RHI Entertainment (now Halcyon Studios), which would later be sold to Hallmark Cards in 1994.

[27] In May 1991, New Line Cinema purchased the home video and foreign rights to 600 films held by Sultan Entertainment Holdings (a.k.a.

[30] On January 28, 1994, New Line Cinema was acquired by the Turner Broadcasting System for $500 million,[31][32] which later merged with Time Warner Entertainment in 1996.

New Line Cinema was kept as its own separate entity, while fellow Turner-owned studios Hanna-Barbera Productions and Castle Rock Entertainment eventually became units of Warner Bros. During its time as an entity separate from Warner Bros., New Line Cinema continued to operate several divisions, including theatrical distribution, marketing and home video.

[34] Despite the success of The Lord of the Rings films, Town and Country (2001) generated a loss of $100 million and De Luca left as production head to be replaced by Toby Emmerich.

[35] In March, Emmerich became president and chief operating officer, whilst both founders Robert Shaye and Michael Lynne had left the company.

As for the company's future, Alan Horn, the Warner Bros. president at the time of the consolidation, stated, "There's no budget number required.