In 1974, Panic Park was closed down due to disasters and disappearances at the park. Karloff Mennis, the creator of Panic Park, placed the park in a state of limbo, trapping the park in a colorless void for all eternity, stuck forever in that day in 1974. The patrons still trapped inside the park became black and white shadows, separated from their bodies. They are constantly searching for their lost bodies, hoping to be restored. They also work for Karloff Mennis (now going by The Menace), aiding him in capturing the Very Special Guests, as he intends to use their fear to power his fear meter and bring Panic Park back to the present.
The Shadow People have the power to suck away the color from whoever they touch. They are ghostly apparitions, unable to be physically touched by others. Due to being trapped in limbo, they are immortal, trapped forever in the age they were when Panic Park vanished in 1974.