First and foremost, and don't let the fancy Criterion release fool you, Carnival of Souls is a B movie. It was made on the cheap with non professional actors and a twilight zone plot. That being said, it's the most effective, compelling, haunting, and distinctive B movie I have ever seen.
The cinematography and locations are eerie and beautiful and while the acting is not always first rate, it is memorable – especially the neighbor, who Roger Ebert called “a definitive study of a nerd in lust” in his review.
This movie is far better than it needed or deserved to be with its meager budget and the crew's lack of experience. For any fan of Twilight Zone or classic horror films of the 50's and 60's, this is a must see, all others should give it a chance and be pleasantly surprised.