John Sayles wrote the script for Steven Speilbergs alien invasion horror movie Night Skies while Speilberg was in preproduction on Raiders Of The Lost Ark. The film was in response to Columbia Pictures' desire for a sequel to Close Encounters Of The Third Kind. Speilberg didn’t want to just make the movie over again, but did feel like a darker chapter of the saga, a companion film more than a sequel, would be a satisfying way to respond to Columbia’s request.
Sayles came back with the story of a rural family living on a farm in the Midwest. Front and center to the story are the family’s children, Tess, her younger brother Wyatt and the family’s youngest, an autistic ten-year-old boy named Jaybird. The Aliens in Sayles’ story also had names, not in the story but in the script, to allow the reader to differentiate between them and to assign them personalities. The lead alien was a sinister cow-murdering marauder named Skar, with him was Hoodoo, Klud, Squirt and a young, wide-eyed alien named Buddee. Although the film is incredibly violent, with graphic depictions of cattle mutilation and a Straw Dogs-like assault on the farmhouse, there is a touching subplot between the young wide-eyed alien Budee and Jaybird.
Speilberg responded well to the script and contacted Rick Baker to begin work on designing the aliens. Italian sculptor Carlo Rambaldi had designed the aliens at the end of Close Encounters but these aliens needed to be much more athletic, versatile and ferocious. Baker was the obvious go-to for such jobs.
While Rick went to work designing prototypes, Speilberg began talking to Ron Cobb, an illustrator who had helped design the cantina creatures in Star Wars. According to How Steven Speilberg’s Night Skies Became E.T., Ryan Lambie’s piece on the film for Den Of Geek, Cobb was working literally down the hall form Speilberg on Conan The Barbarian , and before he knew it, he was also helping Speilberg storyboard Night Skies.
Several months later, Rick Baker had completed work on an animatronic prototype of the alien Skar. Ron Cobb was helping storyboard and design the film and Speilberg was in Tunisia helping Harrison Ford find The Well Of The Souls. Speilberg had decided to produce but not direct Night Skies, and offered the reins to Tobe Hooper, who had recently rose to fame with his film The Texas Chainsaw Massacre. Hooper professed to be not very interested in little green men and passed. Speilberg then offered the film to Ron Cobb, having seen first hand Cobb's excellent visual sense.

Speilberg and Tobe Hooper on the set of Poltergeist
As Raiders wore on, Speilberg, perhaps reeling from the nonstop barrage of snakes, explosions, bullwhips and truck chases, began to have second thoughts about the sensory assault of the marauding aliens. He gave the script to Melissa Mathison, an award winning screenwriter (The Black Stallion) who was on the Raiders' set. She was dating Harrison Ford at the time. The two would later marry.
Mathison read the script and told Speilberg that the most engaging part of the story was the friendship between Jaybird and the young, more approachable alien Budee. Something sparked in Speilberg’s mind, and he saw an entirely new story open up before him, a way to frame a personal story of his own childhood while also incorporating the story of a young, misplaced kid and his friendship with a lonely alien stranded on Earth. The last scene in Sayles’ script is the reveal that young Budee has been left behind by Skar and the gang, who’ve left in a hurry .
Speilberg presented his new take on the story to Columbia Pictures and they were.... not pleased. Nor, according to an article in The Playlist, was Rick Baker. Baker had poured a lot of time, effort and pre-production money into realizing the nasty interstellar marauders. Ron Cobb was also none too thrilled, seeing his opportunity to direct a movie for Steven Speilberg vanish as quickly as it had materialized. John Sayles, by all recorded accounts, was fine with it, and applauded Mathison’s take on the story.
With Columbia’s excitement tepid at best, Speilberg left and set it up at Universal. Columbia was repaid their pre-production expenditures and given a small percentage of the new film’s profits. Cobb was also awarded a small percentage. Baker was out and Carlo Rambaldi was back in.
BUT, and here’s a Hollywood ending if there ever was one, pretty much everyone made out well. Speilberg went on to make E.T., The Extra Terrestrial. The house under siege notion was still viable, and the aliens were replaced with ghosts, and Tobe Hooper came back on board for what would be titled Poltergeist. Not long after, a young writer named Chris Columbus would write a script that he called Gremlins, the story reminded Speilberg of a more lighthearted approach to Night Skies. John Sayles would write his own misplaced alien film, the excellent Brother From Another Planet. And, as one would imagine, Ron Cobb and Columbia’s “small percentage” of ET’s profits turned out to be rather significant amounts of money.
Quite a big wave for a movie that never got made.