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An army of sadistic alien life forms, who look remarkably like our concept of a clown, land their circus tent ship in the sleepy American town of Crescent Cove (filmed in Santa Cruz, California). Mike Tobacco (Cramer) and Debbie Stone (Snyder), out for a romantic evening, spot the newcomers and decide to investigate. They soon encounter the Klowns and barely escape capture, having been shot at by a "popcorn gun." Mike and Debbie rush into town to warn others of the impending danger.
Naturally, they first try to warn the police. Their warnings are met with scorn by Sgt. Mooney, convinced that the couple are nothing more than kids trying to pull a prank. They are viewed with equal skepticism by another police officer, Dave Hanson (John Allen Nelson). Hanson also happens to be Debbie's ex-boyfriend, and his dislike of Mike is evident.
Meanwhile, the Klown Army advances into Crescent Cove, inflicting a genocide during their occupation. They harvest the unsuspecting population, blasting random victims with a ray gun that cocoons them with cotton candy, with lethal results. The Klown Army uses a variety of seemingly innocent methods to ensnare their victims such as killer shadow puppets, bloodhound-like balloon animals and a ray gun that looks like a child's toy. Since the methods themselves appear whimsical, the townspeople don't know they are in danger until it's too late.
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