I'd say 'the blair witch project'
It's kinda scary.
'Dog Soldiers' but then again I saw that when I was eleven years old. That wasn't a brilliant idea.
'The Descent' is really quite decent
'Witchfinder General' but that is more of a psychological thriller imao.
If what I hear is true, 'Cannibal Holocaust' is the real work. And if you really want to go and take it any further than that I believe there is some crazy shit called August Underground that really is more of a gore-porn than it is a film with an actual plot. But technically it's horror.
Never saw it though, and I'm keeping it that way.