Many of Michael Powell's collaborations with Emeric Pressburger received mixed reviews on release, but none were as hated as Powell's first major postwar solo film. The Observer's C.A Lejeune set the tone when she declared herself "sickened" as she walked out of an advance screening. The outrage was echoed by critics across the political spectrum:

"Wholly evil" - The Daily Worker
"Shovel it up and flush it swiftly down the nearest sewer. Even then the stench would remain" - Tribune
"Frankly beastly. De Sade at least veiled his relish with pretensions to being a moralist" - Financial Times
"As unpleasant as they come...Sick minds will be highly stimulated" - The Daily Telegraph
"The sickest and filthiest film I remember seeing" - The Spectator

The backlash was so severe that the film struggled to get an American distribution, and the film underperformed at the box office in the UK despite the efforts of some cinemas to capitalise on the controversy. Powell's career took a major hit - he made just one more UK feature film, with the rest of his career spent mostly on West German and Australian productions.

From the reviews you might expect gratuitous gore, but there's barely any blood. Instead, the film's power to shock comes from its psychological complexity, with the cinematography and Carl Boehm's sympathetic performance forcing the viewer to identify with the killer and be complicit in his crimes.

Later critics came to appreciate these aspects, and saw its interest in voyeurism and the "morbid urge to gaze" as remarkably prescient. Dilys Powell, who labelled it 'essentially vicious' and 'vulgar squalor' in The Sunday Times in 1960, recanted in a 1994 column, where she stated that 'nearly everything I said conceals the extraordinary quality of Peeping Tom' and made a posthumous apology to Michael Powell.

Some figures influenced by the film include Martin Scorsese, who paid to bring it to the New York Film Festival in 1979, and filmmaker/theorist Laura Mulvey, who developed the concept of the 'male gaze' in her 1975 essay Visual Pleasure and Narrative cinema and went on to record a commentary track for Peeping Tom's 1994 Criterion edition.