The Blair Witch Project is low budget 1999 horror movie in which three young film students mysteriously disappear from the face of the earth.
This film was a huge success because its makers did heavy marketing via the Internet, spreading rumors and suggesting or allowing people to think that the material they shot was authentic and that those three people really disappeared. After the movie's success, sequels were shot, and franchising started, computer games were sold and of course all sorts of memorabilia, but the makers couldn't re-create the success or innovation of the original movie, which they claimed created a whole new way of filmmaking, Method Film-making, named after Lee Strassberg's Method Acting.
The technique used was to give the three actors only a loose idea of what they were doing , basically "You are three student film makers doing a documentary on the legend of the Blair Witch", then turn them loose with a professional camera for the documentary plus an amateur camera to document the 'making of the documentary'. The script was almost entirely ad-libbed, the townspeople interviewed were mostly real townspeople making it up as they went along and the three actors had only minimal contact with the real film crew who did not provide any of the footage and had a role more like a 'Dungeon Master'. The 'Real' film crews only task was to prod the actors in the required direction and edit together the film using only footage taken by the actors. The result was a very 'authentic' feeling fictional documentary and three actors that were genuinely cold, exhausted, confused and , most of all, terrified!
In fact the way of incorporating the camera and film team into the plot is not totally new. One of the predecessors of this technique are Danish Dogme95 movies, and, most notably, the Belgian movie Man Bites Dog.