Submitted for classification in June 1986, Labyrinth was the big-screen follow-up to The Dark Crystal, which had been released in 1982. The Dark Crystal was one of the earliest films to be classified PG for its theatrical release in 1982 (the PG category having replaced the former A category, which indicated 'Advisory, parents cautioned that film may be unsuitable for young children'). 

Labyrinth stars a young Jennifer Connelly as Sarah, who wishes away her baby brother Toby to the goblins, a wish that Goblin King Jareth (played by the unforgettably coiffured David Bowie) is happy to fulfill. 

Columbia-EMI-Warner, the distributor of Labyrinth, anticipated a PG rating for the film. Upon examination, however, the BBFC considered the film to be suitable at the U category. Whilst the creatures of The Dark Crystal were previously described by the BBFC examiners as 'frightening and monster like' (albeit in the fairytale tradition), and the overall tone 'rather sombre', the examiners of Labyrinth considered this film to be a lighter prospect, with 'sequences ... which aim at suspense and excitement', which are 'perhaps initially scary for children, but it soon debriefs them with humour and explanation'. 

The early scene in which goblins scuttle around Toby's room, hidden from Sarah, has 'a very slight element of Gremlins ... but this is more properly to be compared with pantomime, particularly as the goblins have already been revealed as fairly innocuous Muppet-creatures.' A later sequence, in which Sarah and Hoggle are chased by a machine with rotating blades, 'sounds worrying but is totally acceptable for U within the context of a children's fantasy and set against the fearlessness of the Alice-like heroine.'

Overall, the examiners reasoned that 'Although spooky, we have never denied children the right to be deliriously scared'. Labyrinth was passed U for cinema release in June 1986, and has subsequently also been classified U for video, DVD and Blu-ray.