What makes Alien so great is the constant feel of uneasiness. Right from the beginning you have a feeling that something is wrong. The crew is not particularly friendly towards each other, and you truly feel all the in-group tension. The ship itself is a huge worn out industrial-style maze of halls and corridors, and it feels more like a prison than a place to live. It is as if not only the alien but also the ship itself is against the humans. The Alien itself is the scariest monster in history because it is a ruthless, soul-less parasite completely devoid of any human or civilized traits. The design of the monster is a stroke of genius. Sure it has a humanoid form, but it has no facial traits or anything else which could give away emotions or intentions. Its actions reveals no weaknesses nor civilized intelligence. The Alien is more or less the opposite of everything human and civilized, plus the creature is more well-adapted to the inhumane interior of the ship than the humans who build it. To sum up, you then have a setting where the humans are caught in a web of in-group tensions, an inhospitable ship and the perfect killer which thrives in the ships intestines. You almost get the feel that the humans are the ones who are alienated to each other and to their own ship.
Ridley Scott tells the story with a perfectly synchronized blend of visuals and sounds.
The actors do a superb job, portraying their characters in a subtle but very realistic way. The seven man crew is not a bunch of Hollywood heroes. They are ordinary people with strengths and weaknesses, likes and dislikes. In this way they all seem so fragile when confronted with the enemy.
As mentioned the ship is very claustrophobic and Ridley Scott adds to the eeriness by using camera movement, lights and shadows in an effective way. The living quarters are bright and should be comfortable to the crew, but there is something sterile about it all. The rest of the ship is basically a huge basement.
The music by Jerry Goldsmith underlines the eeriness so well, and the movie wouldn't have worked without his score. Combined with the sounds of the ship it all adds to the uneasiness.
This is not a story about heroic people who boldly teams up against evil. It's a story about ordinary people facing true fear, which is the fear without a face. The fear we can't understand and can't negotiate with, because its only goal is to survive on the expense of us. It's a story where some people bravely fight back whilst others are destroyed by the terror. It's a story where people a killed in a completely random way. There is no higher-order justice behind who gets to live and who dies. All seven characters are just part of a race where the fittest - not necessarily the most righteous - will prevail, and all seven characters start the race on an equal footing. None of them are true heroes, and none of them are true villains.
All the above makes Alien so great as a horror movie. The terror isn't just the Alien itself, it's the entire atmosphere which gets so effectively under your skin, that you just can't shrug it off after the end credits like you can with so many other Hollywood horror movies. The title "Alien" doesn't just refer to the monster, it is the theme of the movie and it is the feeling you have during and after the movie. 9/10